NETHERLANDS – Shareholder activism by pension funds appears to be a factor in VNU’s decision today to review its planned $6.3bn (€5.2bn) merger with IMS health.

The information firm issued a statement today saying it is currently having “wide-ranging discussions” with IMS regarding opposition by shareholders representing a reported 48% of its outstanding shares.

One of the known players is CalPERS – the California Public Employees Retirement System - via Knight Vinke Asset Management.

KVAM - whose managing general partner company Knight Vinke Institutional Partners and affiliates own an estimated 5m VNU shares and is backed by CalPERS - is among the opponents which informed VNU that “they would not support the transaction under any circumstances”.

A KVAM spokesperson told IPE that a letter was sent to the VNU supervisory board last week, and that it was “encouraged” by today’s announcement. No further comments could be given.

Last month KVAM confirmed that a meeting took place between VNU and shareholders representing approximately 40% of the outstanding share capital.

Other opposition stakeholders include Templeton Global Advisors, Fidelity Investments and the Dutch ING group.

A spokesman for Dutch civil service fund ABP declined to comment but did state it had a “small exposure” to VNU.

IPE understands that the shareholders are objecting to the financial structure of the deal which they believe will see equity given away below value.

The terms of the deal stipulate $23.40 per VNU share.

Another point of contention is execution risk. Some commentators suggest that VNU – owner of market researcher AC Nielsen – has a poor integration track record.

The fact that IMS has a presence in more than 100 countries is therefore of some concern.

VNU said that although both companies believe the transaction served the best interests of all shareholders, they are considering alternatives including “a revised merger agreement as well as a termination of the agreement”.

“There can be no assurance as to the outcome of these discussions and pending any such development, the companies are moving forward pursuant to their merger agreement.”

One report today stated that IMS would seek millions of dollars in payments for costs and impaired reputation if the deal falls through.