WPP PLC (LSE:WPP) shares were up 4.5% at 301.3p in the first half hour of trading on Monday, a sharp rebound that comes just as predators are reported to be sizing up the battered advertising group.
The Sunday Times revealed that France’s Havas has held high-level discussions about a possible move, while private equity houses Apollo and KKR have also examined parts of the business.
The interest is hardly surprising. WPP’s valuation has collapsed to about £3 billion from a 2017 peak of £24 billion, leaving the stock so beaten down that hedge funds have amassed an 8.5% short position.
A looming ejection from the FTSE 100 has only deepened the gloom, as index-tracking funds prepare to pull money.
Whether any suitor will strike remains uncertain, with some investors unconvinced about the scale of the turnaround challenge. Cindy Rose, WPP’s new chief executive, has already branded recent performance “unacceptable” and hired McKinsey for a strategic review.
For now, though, the sudden revival in the share price shows one thing clearly: WPP may be wounded, but it is no longer being ignored.