NEW YORK, June 26 -- JWT Group Inc., the huge advertising and public relations concern, said yesterday it had agreed to a sweetened takeover offer of $566 million from Britain's WPP Group PLC in what would be the biggest acquisition ever in the ad industry.
Under their definitive agreement, London-based WPP will offer $55.50 a share in cash for JWT's 10.2 million shares of common stock and merge JWT with one of its subsidiaries upon successful completion of the tender offer.
The price is $10.50 a share more than WPP proposed when it first suggested a merger 16 days ago and is $5 more than it subsequently offered.
The value of the deal surpasses the previous record $450 million that another British firm, Saatchi & Saatchi Co., agreed to pay for the advertising concern Ted Bates Worldwide last year.
"Our shareholders have been very well served by this agreement," said JWT Chairman Don Johnston, who has headed the firm since the mid-1970s and was believed to have been trying to keep it independent, in a statement.
Charles Crane, who follows the advertising business for the investment firm Prudential-Bache Securities, said Johnston "got top dollar for his firm."
He said it was understandable that Martin Sorrell, chief executive of WPP Group, would boost his offer despite the absence of any publicly announced competing bid. "He wanted the company, and he was sensitive to the idea that dragging it out would only be detrimental to the clients," Crane said.
Repeated efforts to reach Sorrell for comment yesterday were unsuccessful.
JWT is the parent of J. Walter Thompson Co., one of the oldest and best-known names in the advertising business with clients such as Ford Motor Co., Eastman Kodak Co. and Kellogg Corp..
The announcement failed to disclose the board vote on the final proposal or whether Johnston supported the decision.
In addition to Thompson, JWT owns the advertising agency Lord, Geller, Federico, Einstein Inc.; the public relations firm Hill & Knowlton and the research concern MRB Group. Hill & Knowlton last year acquired Washington's Gray and Co. Public Communications International Inc.