In a recent interview with India’s exchange4media Interpublic CEO Michael declined a clear opportunity to close the door on an eventual merger deal with WPP.
Here’s what he said:
“You better ask Martin Sorrell that question! But our perspective is quite simple. There is no need for us to do a transaction. At IPG, we have the size, the scale and the expertise. We are not missing any part of the go-to market strategy – be it media, activation, creative or PR. The only issue is our share price and we have a duty to our shareholders to entertain any offer that potentially comes into being. So, if there is an offer that is extremely attractive for our shareholders, I have always said we must entertain it. Right now, our strategy is to put our heads down and meet the needs of the client as best we can.”
Roth was in London this week for Advertising Week Europe so he may well have bumped into WPP boss Sir Martin Sorrell who was also performing. But Sorrell has stated on numerous occasions that he’s not interested in IPG.
I wonder. Buying IPG wouldn’t make WPP the biggest (its current status) if the Omnicom/Publicis merger goes through but, as WPP’s share price has risen strongly recently, it wouldn’t leave a combined WPP/IPG far behind, ‘only’ a few billion dollars by market cap. The Omnicom and Publicis Groupe share prices are going nowhere fast as the market grows impatient with the delay in securing regulatory approval in China.
Things may move on a bit if Microsft, currently reviewing its $1bn plus global creative and media accounts, dumps IPG’s UM, which handles media outside the US. That would leave IPG’s international media offering in a very dishevelled state (although it’s strong in the US) whatever Roth’s brave words in the interview. Such a move wouldn’t help the IPG share price either.
Would it make sense for WPP to own McCann, FCB and Lowe as it already has Grey, JWT, Ogilvy and Y&R, plus lots of other odds and sods besides? Any successful bid for IPG would leave Sorrell and his cohorts with a formidable job of rationalisation; very likely merging some of these agencies. Sorrell doesn’t seem very keen on agency brands anyway these days, preferring client-based Team this and Team that.
But Roth could hardly have done more to leave the door ajar, could he?