WPP in Talks to Sell Kantar Stake to Bain Capital -- Update
July 01 2019 - 2:38PM
Dow Jones News
By Ben Dummett and Nick Kostov
LONDON--Advertising giant WPP PLC said it has entered into
exclusive talks to sell a majority stake in its Kantar Group
market-research unit to private-equity firm Bain Capital LP in a
deal that values the business at about $4 billion, including
debt.
The sale would mark the biggest move yet by Chief Executive Mark
Read in his effort to revive WPP's fortunes since taking over the
top job last year in the wake of the abrupt departure of the
company's longtime leader and founder Martin Sorrell.
Burdened by a slumping share price, Mr. Read has focused on
cutting London-based WPP's exposure to businesses that don't fit
with a plan to establish a network of more nimble and tech-savvy ad
agencies that can better cope with the upheaval in advertising and
media.
WPP said Monday that there is "no certainty that these
discussions will result in a transaction involving Kantar." WPP
didn't disclose how much of Kantar it was discussing selling to
Bain. On Monday, WPP also announced that it has sold its minority
stake in communications and sports-marketing group Chime Group
Holdings for $69 million.
Kantar offers research, data, social-media moderating and other
services aimed at helping companies tailor their brands,
advertising campaigns and products to reach their target market.
The data provider has weighed on WPP's results for a number of
years, as clients have turned to less labor-intensive digital
sources for customer insights.
That challenge makes Bain's possible acquisition a risky bet.
Still, the buyout firm will have the advantage of trying to
spearhead a turnaround out of the glare of public markets. At the
same time, WPP stands to reap some benefit if Bain's effort's
succeed -- by maintaining a minority stake.
Bain emerged as the winning bidder from a group of rival buyout
firms, including Vista Equity Partners, Platinum Equity LLC and
Apollo Global Management LLC. The buying interest underscores
private-equity investors' healthy appetite for unloved businesses
carved out of larger companies. These deals allow private-equity
firms to deploy their record amounts of cash quickly, while trying
to find turnaround opportunities to generate outsized returns.
Write to Ben Dummett at ben.dummett@wsj.com and Nick Kostov at
Nick.Kostov@wsj.com
(END) Dow Jones Newswires
July 01, 2019 14:23 ET (18:23 GMT)
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