Adecco Still Keen on Michael Page Despite Rejection

The world's No.1 staffing agency Adecco said on Friday it will continue to pursue British recruitment company Michael Page which has twice rejected bid offers worth 400 pence (748.9 cents) a share.

"Adecco believes that there is scope for a combination with Michael Page which is to the benefit of both companies and their respective shareholders," Adecco said in a statement.

Michael Page, which specializes in the professional staffing market, said it had rejected as too low an initial offer of 1.3 billion pounds for the whole group that Adecco made in June.

Adecco revised the offer on Tuesday to propose buying at least 50.1 percent of the British group at a price that would be "consistent" with 400 pence per share, Michael Page said.

"The board ... unanimously concluded that this revised proposal also materially undervalued the company and its prospects and that the proposed transaction structure was unattractive for shareholders," it said.

Adecco, which said this week it wanted a friendly takeover of the British group, said it was still considering an offer.

"Adecco places considerable value on the management and strong culture of Michael Page. It is therefore important to Adecco that it is able to retain the senior management of Michael Page in the event that an offer is completed," it said.

Buying Michael Page would boost Adecco's presence in higher-margin professional and permanent staffing and extend its geographic reach.

Adecco has said it can leverage its balance sheet to 1 billion euros and it had 400 million in shares available for acquisitions.

"I was sceptical from the beginning on this transaction.

Adecco will have to raise the bid significantly, to perhaps at least 500 pence per Michael Page share, to make the situation friendly," said ING analyst Marc Zwartsenburg.

"It is likely the approach will remain hostile as the gap between what Adecco is willing or can pay with regard to their discipline on the balance sheet and the price at which Michael Page will be willing to talk is too large," he said.

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