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Omnicom has agreed to buy Interpublic in a $13bn all-share deal that will create the world’s largest advertising agency in revenue terms and reshape the global marketing industry.
Under the terms of the deal, Interpublic shareholders will receive 0.344 Omnicom shares for each share of theirs. Once the transaction is closed Omnicom shareholders will control 60.6 per cent of the combined company, and Interpublic shareholders will own 39.4 per cent.
The deal comes as artificial intelligence brings significant disruption to the marketing industry, allowing companies to create cheaper, faster, and more targeted advertisements and forcing agencies to invest hundreds of millions of dollars to harness the technology.
Omnicom believes that the combination with Interpublic will help it pool resources to increase investments in AI and retain its central role in the global advertising business.
“Through this combination, we are poised to accelerate innovation and harness the significant opportunities created by new technologies in this era of exponential change,” said John Wren, Omnicon’s chief executive. “Now is the perfect time to bring together our technologies, capabilities, talent and geographic footprints to bring clients superior, data-driven outcomes.”
The combined US group — which generated $25.6bn in revenues annually in 2023 — will be larger than France’s Publicis and the UK’s WPP, the next biggest holding companies in the industry based on net revenues.
The transaction is expected to generate annual cost savings of $750mn. Omnicom’s Wren will remain chair and chief executive. Philippe Krakowsky, chief of Interpublic, will become co-president and chief operating officer of the combined groups.
Interpublic and Omnicom each owns a diverse portfolio of global advertising, marketing, and PR agencies, including McCann, FCB, and Mediabrands under Interpublic, and BBDO and TBWA under Omnicom.
Given the overlap in assets between the two companies, the combination is likely to attract antitrust scrutiny.
Although many dealmakers were expecting a more supportive environment for M&A under Donald Trump, the president-elect has nominated Gail Slater, a tough competition enforcer, to lead the US Department of Justice’s antitrust division.
Omnicom and Interpublic said that they expected to close their transaction in the second half of 2025. The new company will be listed on the New York Stock Exchange.
Combined, the companies generated adjusted earnings before interest, taxes, and amortisation of $3.9bn in 2023, split 57 per cent in the US and the rest internationally. Both companies will maintain their current quarterly dividends through the deal’s close. Omnicom said it would also buy back shares and make other acquisitions.
Omnicom was advised by PJT Partners on the financial terms and by Latham & Watkins in legal matters. Interpublic was advised by Morgan Stanley on the financial terms and Willkie Farr & Gallagher was legal adviser.
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