Cossette value double since putting itself on sale

http://www.reuters.com/article/marketsNews/idCAN2639561320091126?rpc=44

Saying "no" to a hostile bid has virtually doubled the value of Cossette Inc (KOS.TO) and set the stage for a showdown next month between two private equity firms wooing Canada's biggest home-grown ad agency.
Stock in the Quebec-based company languished at C$3.25 a share, close to an all-time low, when Canadian private equity firm Cosmos Capital took a first run at the company in July. Its C$4.95-a-share offer valued the agency at C$78.2 million ($73 million).
Cossette responded by putting itself on the block and hiring Bank of Montreal (BMO.TO) to drum up suitors. It now trades at over C$8 a share as bids or proposals -- there have been five so far -- keep getting higher even as struggling global markets keep advertisers in a trough.
"The board did its job," said one observer, commending Cossette decision makers for not seizing the first bid to come along.
As recently as in 2007 Cossette stock was worth almost C$14 a share, but that was before it lost some key accounts and before most of the modern world entered recession.
The agency has offices in Britain, the United States and China, as well as Canada. It has a major presence in the French-speaking province of Quebec, a difficult market for foreign companies to crack.
But the battle for control has become increasingly acrimonious, and Cossette's challenge is to identify the best bidder, without ruining the chances of a deal.
WHICH ONE?
The two bids currently on the table are each worth C$7.87 a share, one of them from U.S private equity group Mill Road Capital and the second from Cosmos, whose principal investors include two Cossette founders.
Cossette's management recommends the Mill Road offer, which is already backed by 30 percent of shareholders. The proposal is not subject to due diligence and lets Chief Executive Claude Lessard keep running the company.
But Cossette, which serves major transnational clients, including McDonald's, Bell Canada, General Motors and Coca-Cola, can't consummate the deal.
Lockup agreements between Cosmos and two major shareholders give Cosmos control of more than 37 percent of Cossette stock, and an agreement needs 66 2/3 percent approval to go through.