Sir Martin Sorrell, chief executive of London based WPP, said he wasdisappointed by the market's reaction but expects the price to rebound once WPP holds a roadshow to present the benefits of the deal to investors.

Young & Rubicam's shareholders are to receive 0.835 WPP American depositary receipt or 4.175 WPP ordinary shares for each Young & Rubicam share.

The two companies said the combination will produce cost savings of at least $30 million a year, partly because it will eliminate duplication in such areas as information technology and human-resources management.

They also said the deal would have a positive effect on WPP earnings per share in 2001. Executives of the two concerns didn't rule out the possibility that they eventually would integrate their two media-buying operations, WPP's MindShare and Y&R's Media Edge.

Media-buying units negotiate for advertising space and time slots on behalf of clients. Combining the two units would give the merged entity more bargaining leverage with television stations, publications and other media.But the two sides provided few details on how they would integrate.During talks, the two sides focused more on how to avoid losing talent from Young & Rubicam than on the details of how to fit the two companies together, a person close to the talks said.

The two sides appointed a four-person committee to manage the integration of Young & Rubicam into WPP's empire. The members are Sir Martin; Thomas D. Bell, chief executive of Young & Rubicam; Mike Dolan, chief financial officer of Young & Rubicam; and Paul Richardson, chief financial officer of WPP.

-- The Wall Street Journal