Katherine Levy: Dentsu deal is good for industry, not just Aegis shareholders
A view from Katherine Levy

Katherine Levy: Dentsu deal is good for industry, not just Aegis shareholders

It was always going to happen; it was just a matter of when. For years, Aegis has been the subject of takeover speculation that mainly sprung from the fact that the network's largest shareholder was the Havas chairman and media agitator, Vincent Bollore.

His decision to sell his 26.4 per cent stake in Aegis Group had been on the cards and made a takeover by a rival inevitable. If the Aegis board approves the bid at its August general meeting, that holding company will be Dentsu, which will be £3.2 billion worse off but will have a new jewel to show for the investment.

The time is right for Aegis to sell. Jerry Buhlmann, its energetic chief executive, has been in the job for just over two years. In that time, Aegis has been both streamlined (it divested of its market research company, Synovate, for £525 million, in order to focus the business on digital and media communications) and beefed up (since 2010, it has acquired Australia's largest marketing company - Mitchell Communication Group - and a raft of digital specialist agencies as it looked to lead in this area). Then, in January, Aegis rocked the media world when it scooped the global media business for the world's third-largest advertiser, General Motors. As Buhlmann rightly says, the win demonstrates that Aegis can be highly competitive on a global scale.

It is clear what the merger has brought to Dentsu. The Japanese communications giant may be dominant in its own market, but it lacks scale elsewhere. Aegis offers Dentsu global media buying prowess and extra digital capabilities in markets outside of Asia.

The deal seems a good one for Aegis shareholders, while Aegis will also form part of the largest marketing services group in Asia. Clearly, these two factors were enough for the Aegis management board to accept the offer.

The real issue, though, is what the deal means for the industry. It seems competitors are not as anxious as they were when WPP announced it had acquired AKQA, providing one of the world's top creative digital agencies with the firepower of the world's largest communications services group.

The reason is that of all the possible buyers of Aegis, Dentsu is arguably the best option for the industry as a whole. The fact that Dentsu had few media assets in the West is a boon in this scenario. Had Havas or any other holding company secured the deal, we would be looking at an ever-more consolidated, less diverse media agency landscape.

The combined Aegis and Dentsu network offers a point of difference to the rest of the industry, mixing a healthy blend of marketing DNA. This can only be a good thing - it means the media landscape will remain as varied and as competitive as ever.