WPP's stake in Asatsu is part of a strategy by Martin Sorrell, WPP's chief executive, to build the advertising and marketing company's presence in important worldwide markets.
The deal will give WPP a proper foothold in the Japanese domestic media buying market as well as in creative advertising. Asatsu will provide WPP with the media buying muscle while WPP can provide new clients and bring value-added planning and buying to a media market which is relatively undeveloped for western companies.
It has not yet been decided whether MindShare Japan will be combined with Asatsu's own media buying operations, or set up as a separate entity.
WPP International Holding's stake will make Asatsu the largest Japanese advertising group with foreign shareolders, while Asatsu's own stake in WPP will effectively give it 3-4 per cent of the multinational group's shares.
Asatsu's chairman and chief executive, Masao Inagaki, is to be head of WPP Japan and become a non-executive member of the WPP board. Sorrell will become a non-executive director of Asatsu.
Dominic Proctor, chief executive of MindShare worldwide, said: 'The link with Asatsu gives us a huge opportunity to launch a very strong MindShare business in the Japanese market. This is a market which is crucial to our multinational clients.'