- Omnicom is taking over the Interpublic group to create the world’s largest advertising business.
- The deal is expected to generate annual cost savings of $750 million.
- John Wren will remain CEO of Omnicom, while his counterpart Philippe Krakowsky will be Interpublic’s COO.
Omnicom is taking over the Interpublic group in a deal expected to create the world’s biggest advertising and marketing business.
The two had been in third and fourth place, but a combined entity will eclipse both London-based WPP and France’s Publicis.
Investors will receive 0.344 Omnicom shares for each Interpublic share they own. Omnicom shareholders will own 60.6% of the combined group. The deal is expected to generate annual cost savings of $750 million.
Omnicom was valued at about $20 billion at Friday’s close. Shares fell 3.3% in premarket trading. Interpublic was worth $10.9 billion and its stock jumped 15% ahead of the bell.
The new Omnicom will have more than 100,000 staff and offer services across media, precision marketing, CRM, data, digital commerce, advertising, healthcare, public relations and branding.
John Wren, CEO of Omnicom, said the acquisition creates “significant value for both sets of shareholders by combining world-class, highly complementary data and technology platforms enabling new offerings to better serve our clients and drive growth.
“Now is the perfect time to bring together our technologies, capabilities, talent and geographic footprints to bring clients superior, data-driven outcomes.”
Philippe Krakowsky, Interpublic’s CEO, said the two companies had “highly complementary offerings, geographic presence and cultures” and the combined group would offer a “uniquely comprehensive portfolio of services.”
Wren will remain CEO of Omnicom, while Krakowsky and Daryl Simm will be copresidents and COOs of Omnicom.
Three members of the Interpublic board, including Krakowsky, will join the Omnicom board.
