Reports: Publicis, Omnicom to announce merger Sunday

PARIS: Publicis Groupe and Omnicom Group will announce a merger on Sunday, forming the largest marketing and advertising holding company in the world, PRWeek sister magazine Campaign first reported on Saturday.

PARIS: Publicis Groupe and Omnicom Group will announce a merger on Sunday, forming the largest marketing and advertising holding company in the world, PRWeek sister magazine Campaign first reported on Saturday.

Publicis chairman and CEO Maurice Levy is planning to step into the chairman's role at the combined company, while Omnicom leader John Wren would become CEO, according to Campaign. The Wall Street Journal reported Saturday that Wren and Levy will serve as co-CEOs, with Omnicom's Bruce Crawford and Publicis' Elisabeth Badinter both serving in the role of co-chairman.

The merged company would be called the Publicis Omnicom Groupe, according to the Journal.

The merger would need to overcome regulatory hurdles on both sides of the Atlantic, and the new entity would have to resolve a number of potential client conflicts. The combined company would have revenue of more than $23 billion and account for 40% of the global advertising and marketing services market, bumping WPP Group to the No. 2 spot.

On Saturday, Publicis summoned reporters to a Sunday press briefing at 8 am EST (2 pm local time) in Paris. It did not disclose additional information about the subject of the briefing.

The combination would see Publicis' MSLGroup PR network brought under the same holding company as Omnicom's FleishmanHillard, Ketchum, and Porter Novelli, although an exact structure is unknown at this point. Omnicom houses its PR agencies in its Diversified Agency Services division.

Omnicom's PR firms reported an organic year-on-year revenue increase of 3.8% in the second quarter of this year to $336.1 million. Overall, the company's global revenue increased 2.1% to $3.6 billion in the second quarter. Net income grew 2.4% to $289.5 million.

While Publicis did not break out its PR revenue in the second quarter, it reported overall year-over-year organic revenue growth of 5% in Q2 to $2.3 billion. Net profit was up 15% to $411 million.

Spokespeople from the two holding companies could not be immediately reached for comment.

On the advertising side, Publicis owns and operates firms such as Leo Burnett and Saatchi & Saatchi, while Omnicom runs BBDO and TBWA, among others. One difficulty the merger would present is that PepsiCo is a major client of Omnicom, while Publicis agencies work with Coca-Cola. 

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