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Omnicom’s Wren denies interest in Kantar or other WPP assets in wake of Sorrell exit

During a quarterly earnings call for Omnicom this morning, CEO John Wren considered Kantar a potential asset for private equity.

Omnicom's chief executive John Wren turned down rumors of his holding company purchasing Kantar Media or other valuable assets in the wake of WPP head Sir Martin Sorrell's departure.

During a quarterly earnings call today (April 17), Wren said that he knew the departing founder was in the process of evaluating his own portfolio, adding: "I don't know what conclusion the new leadership will reach.” He said he believed that potential rumored assets would be up for grabs, but stated: “In terms of Kantar and the other names that are being bantered about, that's not a key focus for our acquisition dollars.”

He added: “I've imagined that if they decide to sell, that there are any number of other buyers, including probably a private equity. So I'm not much help when it comes to answering that question directly.”

Wren also addressed the exit of his rival directly. He stated: “In many ways, I have a great deal of respect from Martin. I've competed against him for the last 25 years and very honorably.”

As for the earnings for Omnicom, the holding company posted revenues of $3.62bn, a year on year increase of 1.2% from $3.59bn in 2017 Q1. A major catalyst for its growth has been Omnicom’s core group of advertising agencies, which include BBDO, TBWA and DDB, which drove in a profit of 1.6%. A notable big win amongst the network was the Goodby, Silverstein & Partners win of the BMW business from longtime agency partner KBS+. Its media agencies Hearts and Science (which handles AT&T and P&G media spend, and recently won Amgen’s business, further bolstering their expertise in pharmaceuticals) were also highlights for the company, but saw their earnings offset by the struggles facing fellow agency OMD, which has seen a shakeup in leadership as a result.

Wren said he didn’t believe the business overall was underperforming, adding: “We know full well what and why we're performing at the level we are. And we've had to make management changes because we weren't getting the kind of level of activity that we wanted.” Most notable of these changes, the addition of former BBDO New York head John Osborne to oversee OMD North America) Wren continued that it will take ‘some time’ for the new leadership to contribute, and that there are wins of larger pieces of business in the $10-20m range that won’t be revealed for the next couple of quarters.

A rising part of the business for Omnicom has been in the events portion of its CRM business, which has benefitted from the recent Olympic games. So far, Omnicom stock has reacted to the news positively—this morning, the price opened at $75.24 after closing yesterday at $74.03, and at the time of this writing, has reverted close to the previous close at $74.55.

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