Publicis-Omnicom deal hits problems: Will squabbles upend the big merger?

The two sides have said legal and tax issues in Europe are delaying the completion of the deal, first announced last summer, according to the WSJ, which also claims that beyond that, relations have severely frayed, say people with knowledge of the situation.

Apparently, the two sides have yet to agree on which company will be the legal acquirer of the other, say some of these people, which is holding up filing of crucial paperwork with the U.S. Securities and Exchange Commission.

The companies are also at loggerheads over who will fill senior jobs, particularly the position of finance chief. Omnicom is said to want its chief financial officer, Randall Weisenburger. Publicis wants its CFO, Jean-Michel Etienne, to get the job, say insiders.

The delays have caused the companies to halt meetings of many of the roughly 70 integration committees, where the two groups started to mutually present their networks, teams and organization, the WSJ reported citing people close to the scene.

These meetings could only go so far until the merger was completed, as the two groups aren't allowed to share any information on clients or numbers until the deal has secured all its regulatory approvals.

The companies, according to the WSJ, continue to say they expect the deal to be completed. While some executives believe there is too much at stake for the deal to be called off, others aren't so sure.

Publicis CEO Maurice Lévy said last week he thought the deal could close in the third quarter, Omnicom CEO John Wren said this week that he couldn't predict when the deal would close because of its "complexity and open issues."

One of the companies' biggest rivals is WPP CEO Sir Martin Sorrell, whose company would no longer be the world's largest ad holding firm after the merger, said on Friday that the different messages from the CEOs highlight that the deal is doomed.

"You have one talking Chinese and the other Japanese," Sorrell said.