WPP agrees to sell 60 percent of Kantar to Bain Capital
Bain Capital agreed to buy 60 percent of WPP’s market research unit Kantar in a deal that values the business at $4 billion.
The private equity firm entered into exclusive talks with ad group WPP last week after beating out rival buyout companies. WPP will retain around 60 percent of the proceeds of around $3.1 billion from the sale to cut debt to the low end of a target range, and return around $1.2 billion to shareholders, it said in a statement.
Bain was competing against Apollo Global Management, Platinum Equity and Vista Equity Partners in the final round of bidding, people familiar with the auction said previously.
The sale is part of WPP CEO Mark Read’s push to cut debt and simplify the global ad agency network after ditching his predecessor Martin Sorrell’s acquisition-fueled growth strategy. Sorrell had strongly advocated keeping Kantar, which analysts say has underperformed the rest of WPP in recent years.
Kantar CEO Eric Salama said last month that a new majority owner could look for ways to speed up its time to market for data and services, drive growth with existing clients and move its business more into digital activities.
WPP has been struggling to adapt its sprawling global network of more than 100 agencies as clients shift more marketing online, opting against TV and billboard ads where WPP is traditionally strong. Web giants such as Facebook Inc. and Amazon.com Inc. are cutting out agencies and working directly with brands.