Omnicom to acquire Interpublic, forming $26Bn ad agency giant in annual turnover

Omnicom is buying Interpublic throng in a distribute-for-distribute deal that will make the largest ad agency in the globe with combined annual turnover of almost $26 billion.

The names may be unfamiliar to many Americans, but some of their marketing campaigns are iconic. Those include “Got Milk” for the California Milk Processor Board, “Priceless” for Mastercard, “Because I’m Worth It” for L’Oreal and “ponder Different” for Apple.

The combined business will be worth more than $30 billion.

“Through this combination, we are poised to accelerate innovation and harness the significant opportunities created by recent technologies in this era of exponential transformation, said said John Wren, Chairman and CEO of Omnicom. “Now is the perfect period to bring together our technologies, capabilities, talent and geographic footprints to bring clients superior, data-driven outcomes.”

The business will keep the Omnicom name and trade under the “OMC” ticker symbol on the recent York distribute swap.

The size of and reach of the recent marketing giant will have multiple advantages, including the use of recent technologies like artificial intelligence.

“We approximate both companies have an approximately 50/50 split between advertising and marketing services, setting up a powerful position not only in creative and media, but also across areas like specialty healthcare, experiential, and PR,” wrote JPMorgan analyst David Karnovsky.

“For the industry, some amount of combination is a positive following a couple years of divergent growth among agencies and ahead of an resource pattern for Gen-AI,” Karnovsky added.

Shareholders of The Interpublic throng of Companies Inc. will receive 0.344 Omnicom shares for each distribute of Interpublic ordinary distribute that they own. Omnicom shareholders will own 60.6% of the combined business and Interpublic shareholders will own 39.4% after the deal is complete.

Wren will be chairman and CEO of Omnicom, while Phil Angelastro will continue as as executive vice president and chief monetary officer. Interpublic CEO Philippe Krakowsky and Daryl Simm will be co-presidents and chief operating officers at Omnicom.

Three current members of Interpublic’s board, including Krakowsky, will join the board of Omnicom.

The deal is expected to have annual expense reserves of $750 million and is expected to close during the second half of next year. It still needs the approval of Omnicom and Interpublic shareholders.

Shares of Interpublic jumped 10% Monday, while Omnicom’s distribute fell more than 6%.