Holding companies Publicis Groupe and Omnicom Group, set to combine in a $35 billion deal to form the world’s largest marketing services umbrella company, called the whole thing off on Thursday evening. Turf battles over whose executives would fill top positions and international tax and regulatory issues had hindered the deal in recent months.
But what really happened?
Omnicom CEO John Wren: "There was no one factor," he told Reuters this morning, blaming "strong corporate cultures at both companies" among the various "complex issues we haven’t resolved." Wren added: "Uncertainty is never a good thing when you are in the personal service business."
Publicis CEO Maurice Levy: Wren’s counterpart at Publicis told The Wall Street Journal that in the end, the "merger of equals" wasn’t equal enough for Publicis, saying, "We wanted to do a merger of equals, but this principle in the end was not respected."
WPP CEO Martin Sorrell: Not one to be left out, WPP chief Martin Sorrell said ego, not conflicts or tax structures, was the culprit. He added that both rivals wanted to knock WPP off its perch as the world’s number one holding company.
What happens next?
Analysts and investors were split Friday morning on whether the breakup was a good or bad thing for Publicis in the long run, according to the Journal. Omnicom will hold a conference call at 8:30 am.
Who else loses out?
Boutique bank Moelis & Co., which received attention for its role in major deals such as Publicis-Omnicom, was set to pull in more than $10 million in fees after the merger’s completion. The bank went public last month.
Did other major merger news happen last night?
Indeed. Apple is close to buying Beats Electronics for $3.2 billion, according to numerous media reports. Aside from making Dr. Dre the first billionaire rapper, the deal would be a foray into the high-end headphone market for Apple, which would also gain Beats’ subscription music service.
Clowney goes first, but Manziel’s wait steals the show
The Houston Texans took defensive end Jadeveon Clowney of the University of South Carolina with the first pick in the 2014 NFL Draft. Yet the long wait of cocky Texas A&M quarterback Johnny Manziel, picked by the long-suffering Cleveland Browns after a trade with the Philadelphia Eagles at number 22, won Twitter. Here’s one savvy brand that took advantage.
johnny manziel looks like someone waiting for a delivery pizza that will never arrive #DraftDay2014— DiGiorno Pizza (@DiGiornoPizza) May 9, 2014