Omnicom expects it would complete its $13 billion-plus acquisition of rival Interpublic Group in late November after submitting filings for approval from the European Union earlier this week. The ad-holding group, which is heading in the right direction to turn out to be the world’s largest if the deal closes, saw organic revenue increase 2.6% yr over yr in Q3 with revenue totaling $4 billion for the quarter, based on an earnings statement.
In response to an analyst query on where the biggest synergies lie with IPG, Omnicom CEO John Wren highlighted three key areas: Omnicom’s media business, its healthcare portfolio and its precision marketing arm. In addition, IPG will shore up Omnicom’s bets within the increasingly vital race to master artificial intelligence (AI) in marketing. Post-acquisition, Omicom is preparing to launch a sophisticated marketing operating system called Omni Plus that can be supported by IPG assets just like the data-marketing powerhouse Acxiom.
Omnicom’s media and promoting segment could grow between 50% and 60% with the addition of IPG, Wren said, further bolstering an already strong performer at the corporate. Media and promoting led Omnicom’s growth in Q3 with revenue up 9% YoY, an indication that brands are maintaining some marketing activity despite headwinds stemming from tariffs. However, creative agencies are seeing lower levels of project work attributable to macroeconomic uncertainty.
“[F]undamentally, the proof is within the pudding and the budgets haven’t really been slashed or cut,” said Wren on the decision, echoing comments which have been shared by other agency executives in response as to whether tariffs are denting client spending.
“I wouldn’t say everybody is in a euphoric mood, but everybody has dealt with a lot of the challenges which have been thrown at them this yr and persons are seeing themselves through to the opposite side,” Wren added later.
By the numbers
50% to 60%
The estimated range of how much Omnicom’s media business could expand with the IPG acquisition
$61M
Selling, general and administrative (SG&A) expenses incurred by Omnicom in Q3 as a results of the IPG acquisition
$88M
Omnicom’s total acquisition payments in Q3, a figure representing earn-out payments and acquisition of additional noncontrolling interests
Omnicom’s Q3 performance elsewhere was patchy. Healthcare revenues declined 2% on an organic basis while branding and retail commerce continued a double-digit slide, down 17% for the period with rebranding projects, brand launches and in-store retail commerce programs hampered by deteriorating market conditions. Precision marketing eked out growth under 1% in Q3, with Wren acknowledging that the unit’s consulting team has hit bumps within the road but sees “daylight” ahead.
On the AI front, Omnicom’s agentic framework is now the fastest-growing platform in Omnicom history, based on Wren. The group will host a proper launch for the offering on the Consumer Electronics Show in January. Omnicom recently won a big automotive account with a pitch that relied heavily on the agentic framework, executives said.
Omnicom first announced plans to amass IPG late last yr, and the trail to clearing the deal has not been without its twists and turns. Omnicom and IPG in September agreed to a finalized consent order from the Federal Trade Commission that bars them from directing ad spend away from publishers or platforms based on political or ideological views, an unusual requirement that might challenge some established brand safety practices.
The technique of bringing together two massive firms has also incurred steep costs: Omnicom’s selling, general and administrative expenses tied to the IPG deal were $61 million in Q3 and total acquisition payments got here out to $88 million for the period ended Sept. 30.
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