WPP to sell stake in Chime to Providence Equity Partners
WPP is preparing to sell its stake in marketing network Chime Communications to help pay down its debt, it has been reported.
Walking away: WPP is expected to sell its stake in Chime
The advertising giant will offload its 25% holding in Chime to Providence Equity Partners, which already owns a 75% stake, according to The Sunday Times. It claims the deal will be worth £50m.
Under the auspices of former chief executive Sir Martin Sorrell, WPP partnered with the US-based private equity firm to acquire Chime in a £374m deal in 2015.
Since then, however, WPP has been undergoing a drastic reorganisation to simplify its sprawling structure of companies. At the instruction of Sorrell's successor Mark Read, the holding company offloaded its production firm The Farm Group to Picture Shop this month and its market research arm Kantar has been put up for sale.
The disposals will help WPP cut down debts which stood at £4bn according to its latest full-year financials.
Founded in the 1980s, Chime Communications was once headed by Margaret Thatcher's PR guru and longtime Bell Pottinger boss Lord Tim Bell. It has latterly specialised in sports marketing, helping Major League Baseball launch in Europe through its CSM agency which counts Lord Sebastian Coe as executive chairman.
WPP said it had no comment to make on the speculation when approached by The Drum.
Update – Monday 1 July
WPP has now confirmed the sale of its shareholding in Chime, saying the deal is worth £54.4m and potentially additional amounts based on Chime's future value.
"The disposal is in line with WPP’s new strategy as set out in December 2018, a key element of which is to focus on its main areas of business and simplify its operations through the disposal of non-core assets," WPP said in a statement.