French advertising giant Havas has dramatically pulled out of the bidding for Tempus, the London-based media buyer, citing last week's US terrorist attacks as a major reason behind its decision.

The move leaves Sir Martin Sorrell's WPP group as the only bidder for Tempus.

However, it is understood that WPP is also considering its position in the light of last week's events.

Alain de Pouzilhac, the chairman of Havas, said the group could not risk making an acquisition in a fragile economic environment that has been significantly weakened by the atrocities in the US.

"We must not go through with this bid now that a recession is more and more likely. It would be unwise," he said.

"We have a duty both to our shareholders and to our employees who have placed their confidence in us. To make a higher bid would be unreasonable in an environment which is getting worse by the day and which has been hit even harder by the recent terrible events in the USA," he said.

A Havas insider said the company would now look to buy smaller, independent media buyers because prices were plummeting in a deteriorating market.

"We are already looking at other independents around Europe, where we need to bolster our activities. In these conditions, prices are going down and it might present an opportunity," he said.

A number of advertising and media campaigns have been pulled in the wake of last week's events, and the advertising industry is battening down the hatches for a steep decline in business.

Havas has effectively withdrawn its 541p per share offer for Tempus by saying it will not extend the deadline for acceptance of its bid beyond next Monday. Havas has received approval from just 30% of Tempus's shareholders.

WPP's counterbid of 555p per Tempus share expires on October 1, and if does not get approval from 90% of the Tempus shareholders by then, it could withdraw its offer.