WPP's GroupM set acquire Essence Digital
WPP’s ad buying company, GroupM, is closing in on a deal to acquire Essence Digital.
The WPP-owned advertising media company is set to take over its largest digital target which would take its 2015 transitions to 39, according to The Wall Street Journal.
Essence, which is based in London and has offices in the US and Asia, is one of the largest independent buyers of digital ads, spending more than $700m on digital media annually. The company acquired Seattle-based mobile agency Reach in 2013 and has clients such as Google, Visa and Electronic Arts.
In the last few years Essence has significantly strengthened its business by acquiring a number of agencies specialising in social media and mobile space.
Julie Langley, partner at Results International, the leading M&A advisers to the sector, said the acquisition illustrates the extent of WPP’s digital and programmatic consolidations.
She said: “A deal would actually break the mould on WPP's acquisition strategy” given that it isn’t known to “win in competitive processes for stand-out, high-growth businesses."
Given that Essence is reported to be Google’s main global digital agency Langley said: “WPP must see sufficient strategic imperative to warrant a strategic price – likely down to a combination of the Google relationship and keeping that business out of the hands of competitors.”