Publicis Groupe eyes acquisition of Epsilon
"The group's governing bodies feel an obligation to study any possibility to strengthen its position thanks to assets that could fit the group's strategy and bring an enhanced service to the group's clients, while reinforcing its competitiveness for the future," Publicis stated in a press release. The holding company cautioned that while discussions are underway it "cannot give any indication on whether a transaction would materialize or not."
Epsilon, which is owned by Irving, Texas-based Alliance Data Systems, is ranked as the world's 13th largest agency company with revenue of $2.3 billion in 2017, according to the latest figures from the Ad Age Datacenter. Epsilon reported 2018 worldwide revenue of $2.2 billion.
Alliance Data on Nov. 27, 2018, said it was "exploring strategic alternatives for its Epsilon business," including "a potential sale of the business." The move came after another data venture, Acxiom, earlier in 2018 went on the block and was acquired by Interpublic Group of Cos. in October for $2.3 billion.
Epsilon has also attracted interest from Advent International and Goldman Sachs Group Inc., Bloomberg reported last week, citing people familiar with the matter. The winning bid could be finalized as soon as this week in a deal that could be worth $5 billion, Bloomberg reported.
An Epsilon deal potentially could be the largest-ever acquisition of an agency company, surpassing Dentsu Inc.'s $4.9 billion acquisition of Aegis Group (2013) and WPP's $4.7 billion purchase of Young & Rubicam (2000). Even so, a takeover by Publicis wouldn't change the top of the agency company rankings. Publicis would continue as the world's third-largest agency company, behind WPP and Omnicom.
Alliance Data bought Epsilon for $314.5 million in October 2004 and expanded Epsilon through acquisitions. Epsilon's businesses include its digital media arm Conversant, which specializes in personalized digital advertising.