Publicis and Omnigroup to go for a USD 35.1 bn merger to form the world biggest advertising group

Publicis and Omnicom plan to merge – companies revealed on Sunday. Presented as a ‘merger of equals’ deal, the shareholders of Publicis and Omnicom will hold 50% of the new company’s equity and is expected to be tax-free for shareholders of both the companies.

The move will help bolster Publicis and Omnicom to position themselves as  the world’s largest advertising group. Moreover, the possible merger which worth around $35.1bn – would put a serious pressure on other rival companies – to do deals in order to keep pace with the futuristic ‘global leading company’ in communications, advertising, marketing and digital services space. The deal will position both the companies’ as twice the size of their nearest rival WPP and a much stronger contender in the space, if compared to other global players like Interpublic and Havas.

The holding company will be known as Publicis Omnicom Group and will be registered in Netherlands, whereas the Group’s operational head offices will continue to be based in Paris and New York. John Wren, Omnicom’s CEO and Maurice Lévy, chairman and CEO of Publicis Groupe will lead the group for a period of 30 months, before Lévy steps back to become chairman, leaving Wren as the lead executive, as mentioned in another publication.

“John and I have conceived this merger to benefit our clients by bringing together the most comprehensive offering of analog and digital services. Equally important, it will offer our talented people new avenues for growth and success at the crossroads of strategic intelligence, creativity, science and technology.” said Lévy.

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Founded in 1926, Publicis is a French multinational advertising and public relations company, headquartered in Paris, France. The company is operational in more than a hundred countries.

Speaking on the occasion, John Wren said that the merger will enable both the companies in leveraging the skills of their employees, their broad product offering, enhanced global footprint, and tremendous roster of global and local clients.  “This will set our new company on a path to accelerated growth, with long-term benefits for clients, employees and shareholders.” added John.

Omnicom Group Inc. is an American global advertising, marketing and corporate communications conglomerate, with its headquarter in New York, USA. Omnicom handles a number of companies under its brand name offering advertising, marketing services, specialty communications, interactive/digital media and media buying services to its 5000 clients worldwide.

Undoubtedly, the merger will further strengthen the position of both the companies, but a major concern that could possibly blurr their future is the matter of maintaining a harmonious balance of power, as the giants would now have to fit and work together in a much bigger organisation while understanding each other’s clientele needs.