Omnicom Group Inc
Publicis Groupe SA
) have signed a definitive agreement to merge together to create
Publicis Omnicom Group - arguably the world's biggest
communications, advertising, marketing and digital services
company. With combined 2012 revenues of $22.7 billion and an
equity market capitalization of approximately $35.1 billion, the
transaction is a merger of equals and is expected to close in the
fourth quarter of 2013 or the first quarter of 2014.
Every shareholder of both the companies will hold about 50% of
Publicis Omnicom Group's equity. Publicis Groupe shareholders
will receive one newly-issued share of the agency for each
Pubicis share they own with a special dividend of €1.00 per
share. Omnicom shareholders will get 0.813 newly-issued shares
with a special dividend of $2 per share.
This merger brings together iconic agency brands that will offer
clients the industry's leading talent across geographies. With
over 130,000 employees, the new group will be well positioned to
serve clients and help them better to build their brands and grow
The communication and marketing landscape has been through a
roller-coaster ride in the past and this merger is likely to
reopen new avenues for growth and success for the individual
companies. This merger will enable the agencies to make best use
of their skilled workforce, diverse product offerings, and
enhanced global footprint to leverage a list of global and local
clients and reap synergistic benefits. The combined agency is
expected to generate efficiencies of $500 million in future.
Maurice Lévy and John Wren, the CEOs of Publicis Groupe and
Omnicom, respectively, will be the co-CEOs for the new entity for
an initial period of 30 months, following which Lévy will become
non-executive Chairman and Wren will continue as the CEO.
Omnicom is one of the largest advertising, marketing and
corporate communications companies in the world. Omnicom has a
strong track record of winning new clients and receiving
additional deals from the existing ones. The company's business
mix is well-diversified geographically and benefits largely from
the growing markets. In addition, the company's efforts in
maintaining controlled expenses and strong global reputation are
Omnicom currently has a Zacks Rank #3 (Hold). Other stocks
that look promising and are worth a look are
Clear Channel Outdoor Holdings Inc
), both carrying a Zacks Rank #2 (Buy).
CLEAR CHANL OUT (CCO): Free Stock Analysis
HARTE-HANKS INC (HHS): Free Stock Analysis
OMNICOM GRP (OMC): Free Stock Analysis Report
PUBLICIS GP-ADR (PUBGY): Get Free Report
To read this article on Zacks.com click here.