In November 1999, privately held Leo Group and MacManus Group announced plans to combine under a single holding company, Bcom3 Group. Dentsu kicked in $493 million in cash and took a 20% stake in Bcom3 to make the deal happen in 2000.
The new holding company hoped to do an IPO within two years, but that plan was scotched when the stock market tumbled. Dentsu in 2001 considered buying all of Bcom3, but those talks were suspended when Dentsu focused on its own initial public offering, completed in November 2001.
In October 2001, Publicis Groupe Chairman-CEO Maurice Levy approached Bcom3 about a merger, and the deal quickly turned three-way. Dentsu, fresh from its IPO, agreed to pay about $500 million cash for additional Bcom3 shares, helping cinch the Publicis/Bcom3 deal. Dentsu ended up as the largest shareholder in Publicis, with a 14.6% stake.
Under its deal with Publicis, Dentsu agreed to keep its shares until at least 2012. It also struck an alliance with Elisabeth Badinter, 62, daughter of Publicis' founder. Ms. Badinter is chair of Publicis' supervisory board and the second-largest shareholder with a 10.2% stake.
Dentsu agreed to vote its shares as directed by Ms. Badinter "on a number of matters," according to a regulatory filing.
Under Publicis' rules for proportional voting rights, Dentsu and Ms. Badinter in total control 37% of voting shares, giving them huge influence if any merger comes up for a vote.