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Australia: Media giants unite in $1 billion merger

By  |  December 14, 2015

The boss of STW Group says a $1 billion merger with British advertising giant WPP will give Australian agencies more power to fight back as big multinationals increasingly squeeze down their costs for ad services.

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    In an interview with The Australian, STW chief executive Mike Connaghan said a deal to combine WPP’s Australian operations with ad agencies operated by ASX-listed STW creates “a business that is twice the size”, and “scale is increasingly important in our game”.

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    The combination will bring some of Madison Avenue’s best-known advertising agencies including J. Walter Thompson and Ogilvy together with WPP-owned media agencies Mindshare, Maxus, MEC.

    It will have annual revenue of $847 million and combined earnings of $142m. Under the terms of the deal, WPP’s local operations were valued at $512m, and STW at $516m.

    Full content: The Australian

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