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Accenture makes running in global M&A says new R3 report

Global marketing consultancy R3 has been casting its eye over mergers and acquisitions in 2017 and, while the overall number and value was flat compared to 2016, the tectonic plates appear to be shifting with deals by agency holding groups – chiefly WPP, Dentsu, Omnicom, Interpublic and Publicis – declining 46 per cent to $1.8bn while deals by consultancies – chiefly Accenture followed by Deloitte, IBM, KPMG and McKinsey – more than doubled (+134 per cent) to $1.2bn.

However about $1bn of this was accounted for by Accenture which seems to have stolen a march on its consultant competition. It’s easy to see how crowded this space could become if Accenture’s rivals up their deal-making.

R3 Principal Greg Paull says: “It’s clear that the consulting firms have seen the opportunities and are more willing than ever to open their wallets for them. Accenture alone invested more in 2017 on acquiring agency assets than WPP, Omnicom, Interpublic and Dentsu combined – most of who had depressed stock value through the year.”

By region, Europe saw the largest increase (34 per cent) with $3.7b in deals despite a decrease in the overall number although the US remains the biggest market at over $6bn. Paull says: “All of the top ten Europe deals involved at least $100m in transaction value each as WPP, Dentsu and some non-traditional acquirers took advantage of slower business conditions to make some significant moves.”

The biggest global deal was private equity house Bain Capital’s acquisition of a majority of third largest Japanese agency ADK for $1.18bn.

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