A PYMNTS Company

Australia: Media giants unite in $1 billion merger

 |  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.

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”.

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

Want more news? Subscribe to CPI’s free daily newsletter for more headlines and updates on antitrust developments around the world.