Omnicom and Publicis set to tie the knot

French advertising group Publicis President Maurice Levy speaks during the general assembly of the company on May 29, 2013 in Paris.

Two giant ad agencies are to merge. Omnicom of the U.S. and the French firm Publicis are tying the knot in a $35 billion deal.  

Even the superlatives favored by the ad industry hardly do justice to the deal. It is a monster, a mammoth. The new group will be the world’s biggest, employing more than 130,000 people and with annual sales approaching $23 billion. But analysts say other ad agencies will be salivating over the merger because the two firms are so big they will bring rival accounts under the same roof -- like Coke and Pepsi. And that could lead to a shake up in global advertising business.

“It may be that clients -- because of conflicts of interest within a particular industry -- decide to look for another supplier of advertising services . And I would expect most of the industry participants to watch for that,” says Euan Stirling of Standard Life Investments.

A Franco-American deal like this is unusual and might be expected to step on French national sensitivities. But because it is not a takeover -- because it’s described as merger of equals, with two CEO’s acting in tandem -- the French government has, reportedly, given its blessing.  

About the author

Stephen Beard is the European bureau chief and provides daily coverage of Europe’s business and economic developments for the entire Marketplace portfolio.

Comments

I agree to American Public Media's Terms and Conditions.
With Generous Support From...