Omnicom boss John Wren has signed a new contract – at a bargain basement $1 a year – to stay on as chairman and CEO until the end of 2028, when he will step down to be executive chairman. Wren, of course, has recently made the second biggest call of his business life (the first was an aborted merger with Publicis Groupe over a decade ago) with the agreed merger with IPG (in effect a takeover by Omnicom.)
Wren’s base salary was $1m although he can console himself with an option to buy four million Omnicom shares (currently $75) granted on May 12.
The Omnicom/IPG merger is currently grinding through various regulatory processes across the world (Britain’s Competition and Markets Authority is currently looking at it) although it would be tough if it were blocked considering the stranglehold tech giants Google and Meta currently have over advertising (they’re forever being investigated by some body or other but nothing substantive ever seems to happen.)
Wren will be hoping they get a move on (as will IPG CEO Philippe Krakowsky who stands to make far more than Wren from the deal – $52m according to some reports, both above) as IPG is leaking accounts and losing people even as it continues to operate independently.
What will a merged Omnicom/IPG look like and who, eventually, will succeed Wren as CEO? It will be the biggest with a revenue of about $25bn (unless there are further upsets at IPG), well ahead of Publicis and WPP. By market cap things are reversed: Publicis is currently worth $26bn against Omnicom/IPG’s $21bn, suggesting investors are far more convinced about the French-based group’s prospects.
So plenty of challenges ahead for Wren who has to navigate job losses and the client dissatisfaction that comes with it to achieve the cost savings underpinning the deal. But Wren has a solid record as a manager and he’ll inherit some valued IPG businesses: creative networks McCann, FCB and MullenLowe, a Mediabrands operation that’s stronger in the US than elsewhere, data business Acxiom which has so far failed to produce obvious magic for IPG but will add to Omnicom’s data cocktail bar plus PR headed by Golin and Weber Shandwick. They may not all survive of course.
As for Wren’s successor as CEO, it looks pretty certain to be an insider used to working with Wren, who’ll still be exec chairman at 76. So tricky for an outsider. COO Daryl Sim, who used to head Omnicom’s media line-up is the ante-post favourite, reflecting media’s current pre-eminence among the holding companies. A decade or so BBDO’s Andrew Robertson was mooted as an eventual successor but creative networks have lost ground in holding company land pretty spectacularly. Krakowsky shouldn’t be written off (he’s staying on) but he may wish to spend more time with his money.
2028 is a long way ahead though and there may well be more dramatic developments among the ad holding companies before then.
