We’re on the conference call at which Publicis and Omnicom are expected to announce their merger, creating the world’s largest ad agency holding company.
Here’s the official announcement.
Publicis CEO Maurice Levy is speaking first, alternating between French and English. He begins by praising Omnicom CEO John Wren.
The merger is completely unexpected. It was thought that perhaps Publicis might acquire a smaller network, such as Interpublic, or merge with an Eastern rival like Dentsu.
The new Publicis Omnicom Groupe will have $23 billion in revenues and a market cap of $35 billion.
Adweek notes that if the deal triggers change-in-control provisions at Omnicom, CEO John Wren will receive a $70.6 million payout. Adweek’s Noreen O’Leary also describes how the deal will affect the board of Publicis:
Such a transaction would help Publicis buy the stock of retiring chair Elisabeth Badinter, the daughter of Publicis founder Marcel Bleustein-Blanchet, who has been a member of the holding company’s Supervisory Board since 1987 and its chair since 1996. She is expected to retire from that capacity at the end of 2015. Badinter, 69, is Publicis’s largest shareholder, with 9.13 per cent of the company’s stock and 16.57 per cent of voting rights. At the company’s current stock price of $59.35, her 19.2 million shares are valued at $1.1 billion. Depending on the terms of the deal, her holding could be halved.
David Jones, CEO of rival network Havas Worldwide, has questioned the deal, saying it will not be in the best interest of clients because the new behemoth might be more bureaucratic and less nimble.
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