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China: Alibaba & Tencent look to buy minority stake in WPP

 |  July 22, 2018

Alibaba, Tencent, and venture capital firm China Media Capital Holdings (CMC) are in the early stage of discussions to buy around 20% of WPP China.

The deal would see WPP pool its Chinese agency operations into a new holding company, before the consortium would acquire equal shareholdings in the new company. WPP would keep overall ownership and control of the operations.

Partially separating its China business—which could be worth about US$2 billion—by including minority investors could help underpin its value through a separate market valuation.

WPP, along with global peers Publicis and Omnicom, has been struggling in recent years with a market shift from a traditional agency-based model to digital media, and from lower spending by traditional clients.

WPP’s woes have been compounded by the uncertainty caused by former CEO Martin Sorrell’s sudden departure in April. Its shares have lost 28% of their market value since 12 months ago.

Full Content: Financial Times

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