Publicis Groupe closes in on $4.5bn Epsilon acquisition

Publicis Groupe is reportedly close to a deal to buy Epsilon

Publicis Groupe is believed to be close to acquiring data marketing business Epsilon for a fee in the region of $4.5bn.

A deal with Epsilon owner Alliance Data Systems could even be concluded before the weekend is over, according to The Wall Street Journal.

If an agreement can be struck, it is likely to go down as one of the marketing industry's biggest ever takeovers, surpassing the $3.7bn Publicis paid for Sapient in 2014 and coming close to Dentsu's $4.9bn acquisition of Aegis Group in 2013 and WPP's $4.7bn buyout of Young & Rubicam in 2000.

It is no secret that Publicis Groupe has been courting Epsilon. The world's third largest holding company announced as much in a statement on 1 April.

“Publicis Groupe confirms that it is studying the potential acquisition of Epsilon, which is currently under a sale process by Alliance Data Systems Corporation,” it said at the time. “Epsilon is a major player in data and targeted marketing solutions (mass personalization) operating mainly in North America.”

Epsilon generated revenues of $2.2bn in 2018. The company could potentially give Publicis Groupe a stronger point of differentiation in the US where it has suffered from "revenue attrition" in traditional advertising.

"There is definitely a rationale in that it would give Publicis information on 200m-plus individual customers and expand its service offering in areas such as strategic analysis on the marketing side," The Financial Times quotes analysts at Liberum as writing.

Publicis Groupe will post its Q1 financial results on Wednesday (17 April).

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