Nielsen shares tumbled 16% at the opening bell Monday after the TV ratings and marketing data company rejected a $9 billion takeover bid from a group of private equity firms.
Nielsen said that the offer of $25.40 per share “significantly undervalues” the New York City company. It said late Sunday that it had consulted with, among others, its third largest shareholder WindAcre Partnership, which opposed the sale at those terms.
WindAcre said Sunday that it would acquire enough shares to scuttle the deal if the board went further. Nielsen said that shareholder approval was unlikely without support from WindAcre, which already owns a stake of more than 9%.
“We do not believe the offer comes close to recognizing Nielsen’s intrinsic value and we were not going to be forced out of our holding at this price," said Snehal Amin, managing partner of WindAcre. “We intended to block the transaction, so that we could realize, in time, the intrinsic value of our investment. We believe strongly that the Board made the right decision in the face of an inadequate offer.”
Nielsen, instead, will begin buying its own shares under a previously approved $1 billion share repurchase authorization.
Media companies have been more vocal recently in their unhappiness with Nielsen, which for decades has had a virtual monopoly on measuring television viewership, statistics used to govern billions of dollars in advertising spending. Critics allege that Nielsen is not equipped to handle the dramatic shift toward streaming services and viewing on a wide array of devices.
Speculation over a possible takeover first emerged last week, sending shares up 30%.
Nielsen said Monday that it is on schedule to deliver its solution for tracking viewership across media platforms sometime this year.
At the opening bell, shares of Nielsen Holdings Plc. slumped $3.92, to $20.52.
