Blow as Saatchi float delayed

A BUMPER pay day for advertising gurus Maurice and Charles Saatchi suffered a last-minute scare today after the float was delayed.

The M&C Saatchi issue was due to be priced last night by Lehman Brothers with the shares to debut on the Alternative Investment Market today.

But a brief Stock Exchange statement at the start of trading said: 'The issuer's advisers have notified the London Stock Exchange that M&C Saatchi has postponed its proposed offering. When-issued dealing will not commence today and is postponed until further notice.'

But it is hoped Lehman may yet be able to price the issue today and begin conditional trading. It is understood an 11th-hour legal claim was made against the ad agency by a disaffected sponsorship business.

Any liability arising from the claim had not been included in the M&C Saatchi pathfinder prospectus and it is thought Lehman had to spend several hours contacting investors to explain the situation.

The float had been due to be priced at between 143p and 164p a share, valuing the firm at up to £87m. That has now been scaled back to 125p, giving a value of £68m.

The five founders of the agency, including the Saatchi brothers, had been expected to raise £4m in cash from the float and retain stakes worth £6m apiece.