Omnicom has made a pounds 143 million offer for the GGT Group in a
deal that would make the US-based advertising conglomerate the largest
in the world in revenue terms.
Omnicom’s 200p a share offer has already had the seal of approval from
GGT’s board including its chairman, Michael Greenlees, and BDDP’s
chairman, Jean Marie Dru, both of whom will take up senior management
positions within Omnicom.
Greenlees, who also held discussions with WPP, said the sale of GGT to
Omnicom would benefit clients and staff. ’At this stage in our company’s
development, it represents value for our shareholders.’
John Wren, chief executive of Omnicom, denied that the deal would result
in the merger of Omnicom’s TBWA Simons Palmer in London with BDDP
But privately, insiders acknowledge that a merger would make sense.
Wren said: ’I can tell you with some certainty that we have no plans to
merge in London. With respect to the rest of the group, we will consult
with management and clients before making any final decisions.’
TBWA has 87 agencies worldwide while the GGT-owned BDDP network is
concentrated in France - where TBWA is weaker - in the US and the UK.
The two networks have few global conflicts. TBWA’s flagship client is
Nissan while BDDP, despite handling BMW in France, does not have a
network-wide car client.
Sources close to the deal said BDDP’s co-founder, Jean Claude Boulet,
would be leaving the group. He is reported to be rejoining his old
network, Young & Rubicam. They added that Greenlees was tipped to head
the global management of any expanded TBWA network.
The offer, which followed BDDP’s loss of the Procter & Gamble business
from its New York agency last week, received a mixed response from
Some regarded it as ’at market level’ while others, notably Lorna
Tilbian of Panmure Gordon, said the deal was ’no knockout’.
It means that shareholders are faced with receiving 20p less a share
than when GGT first bought the ailing French BDDP network in April. In
London, the share price rose more than 15 per cent on Wednesday to close
The deal would add about dollars 300 million in revenue to Omnicom,
which reported dollars 2.6 billion in revenue in 1996. WPP also reported
revenue of dollars 2.6 billion in 1996.