Ireland-based advertising agency
WPP Group Plc.
) recently declared that it has acquired an 87.76% stake in
France-based, Press Index S.A. The acquisition was carried out
through the company's information, insight and consultancy services
In addition, the company will also initiate a cash tender offer
through its wholly-owned subsidiary Kantar to acquire the remaining
shares of Press Index. Press Index, established in 1997,
specializes in offering media monitoring services to its clients
and currently has a staff strength of 210 people. As of 31 December
2011, the agency generated revenues of EUR 17.5 million and had EUR
12 million in gross assets.
The company through this acquisition has stepped forward to
expand its reach in the European market. In the first 5 months of
2012, WPP Plc's wholly-owned operating companies carried out a
series of acquisitions. Among these, Kantar's $1.2 million
investment in Enprecis, Burson-Marsteller's acquisition of assets
of Crowdverb and Carnation Internet Tanácsadó Zrt deserve special
In addition, lately, WPP Plc also agreed to acquire a 70% stake
in Brazil-based leading digital agency, Foster Informatica, Ltda
through its global advertising and communications unit, Ogilvy
& Mather for an undisclosed amount. The series of acquisitions
are likely to provide a major competitive advantage to the company
and expected to have a positive impact on the company's growth
Earlier, in the first quarter of 2012, WPP Plc witnessed about a
7.6% revenue growth on the back of strength across all geographical
regions and communication services sector. Management is
anticipating that the revenue growth will be over 4% for 2012
excluding the impact of acquisitions and currency fluctuations.
The current Zacks Consensus EPS Estimates for WPP Plc are $5.62
and $6.29 for 2012 and 2013, respectively. The estimates represent
year-over-year growth of 4.52% for 2012 and 11.86% for 2013.
The company has established itself in the diverse markets
through providing advertising and other specialty communications
services globally but it should also be aware of the stiff
competition from its rivals. This Dublin, Ireland-based advertising
and communications services provider competes with other industry
Focus Media Holding Ltd.
Lamar Advertising Co.
National CineMedia, Inc.
We currently maintain a 'Neutral' recommendation on WPP Plc. The
stock also bears a Zacks #3 Rank, implying a short-term (1-3
months) 'Hold' rating.
FOCUS MEDIA HLD (FMCN): Free Stock Analysis
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WPP PLC (WPPGY): Free Stock Analysis Report
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