Former WPP boss Sir Martin Sorrell has won the first round with his old company, beating WPP to $300m MediaMonks, a Dutch digital content company.
Sorrell has had to bid high though, not just in terms of cash but in also, reportedly, offering the MediaMonks management shares in his new company S4 Capital. Sorrell plans to control S4 through B shares with most of the votes. S4 plans to offer new shares worth up to £1bn.
He may lose up to £20m WPP is still contracted to pay him as a “good leaver” as WPP has accused him of breaking a confidentiality arrangement in bidding for and winning MediaMonks, which was also on its radar. It says Sorrell was involved in talks with MediaMonks when he was CEO of WPP.
MediaMonks has a global network (much smaller than WPP’s admittedly) and about 750 staff so it could become the main driver of S4. Were he to make any more big acquisitions there would be a tricky balancing act with S4 shares if Sorrell still wants to keep an iron grip on the company.
Is MediaMonks capable of such a defining role? It’s not an ad agency, indeed it works for lots of ad agencies, so there’s the potential to get on big client rosters as a new kind of supplier.
It’s now time for Sorrell’s legendary address book – he’s currently in Sun Valley in the US hobnobbing with the likes of Mark Zuckerberg and Rupert Murdoch – to earn its keep.
Sorrell says: “This represents a significant step in building a new age, new era, digital agency platform for clients. MediaMonks’ roots are totally in new media, and data, content and technology. Our next moves will be to build this platform further and to add meaningful data analytics and digital media buying. The company will be a unitary one with MediaMonks as its core.”
So there you are then. MediaMonks employees are referred to as ‘monks.’ There’ll be tweets of SMS in a habit any minute. But it looks a good deal for a man in a hurry.