|Revenue ($ in millions)||2020||2019||% chg|
Asterisk (*) indicates figures are Ad Age estimates.
The Stagwell Group is an investment firm that invests in new media and digital marketing services. Stagwell is led by Mark Penn, a former Microsoft Corp. and WPP executive.
Deals and strategic moves:
MDC Partners' board in December 2020 approved a merger agreement with Stagwell in a deal that had been anticipated since Stagwell made its initial merger proposal in June 2020.
Stagwell, already MDC's biggest shareholder, would own 79% of the combined company under the deal. The deal was subject to various approvals including approval by MDC shareholders. Stagwell and MDC hoped to complete the deal in the first half of 2021.
Stagwell in March 2019 invested $100 million in MDC, an agency company, by purchasing $50 million in MDC common shares and $50 million in non-voting convertible preference shares. As part of the deal, Penn, Stagwell's president and managing partner, joined MDC as CEO and a board member.
Following the 2019 transaction, Stagwell owned about 19.5% of MDC outstanding common stock. Assuming full conversion of the preference shares into MDC common stock, Stagwell would own about 29.2% of MDC outstanding common stock. Assuming conversion of both Stagwell preference shares and outstanding Goldman Sachs preference shares issued in 2017, Stagwell would own about 24.8% of MDC outstanding common stock.
Assuming full conversion of the preference shares into MDC common stock, Stagwell controlled 29.4% of MDC outstanding common stock as of March 31, 2020.
Stagwell's investment came after MDC in September 2018 announced the planned exit of Chairman-CEO Scott Kauffman; a search for a new CEO; and MDC's "intention to explore and evaluate potential strategic alternatives, which may result in, among other things, the possible sale of the company." In announcing the 2019 deal with Stagwell, MDC said: "This represents the conclusion of the strategic review process and CEO search."
Penn became MDC's CEO on March 18, 2019, and was named chairman effective April 18, 2019.
Other deals and strategic moves:
Stagwell in February 2020 acquired Sloane & Co. (Sloane and Company LLC), a PR agency in New York, for an aggregate purchase price of $26.7 million, consisting of cash paid at closing plus contingent deferred payments expected to be paid over the two years following the acquisition. Sloane had been owned by MDC.
Stagwell in January 2020 acquired Headliner Labs, a technology consultancy that specializes in chat and voice capabilities, and aligned it with ForwardPMX.
Stagwell in December 2019 acquired The Search Agency, a digital agency in San Francisco, and aligned it with ForwardPMX.
Stagwell in September 2019 acquired Emerald Research Group, a market research firm in Bellevue, Washington.
Stagwell in April 2019 acquired MultiView, a digital business-to-business agency based in Irving, Texas.
Stagwell in October 2018 acquired a majority stake in travel media and marketing agency Ink Global through its Stagwell Media fund.
Stagwell in April 2017 acquired health care agency Scout through its Stagwell Media fund.
Stagwell in April 2017 bought a minority stake in MMI Agency, a digital agency in Houston.
Stagwell in September 2016 made a preferred share investment in Finn Partners, a public relations agency. As part of the deal, Stagwell bought preferred stock in Finn Partners carrying future conversion rights to a minority interest in the agency.
Stagwell in August 2016 acquired a majority stake in digital and direct marketing agency PMX Agency through its Stagwell Media fund.
Stagwell in January 2016 acquired a majority stake in digital agency Code and Theory through its Stagwell Media fund.
Mark Penn founded The Stagwell Group in June 2015. Before starting Stagwell, Penn held senior executive positions at Microsoft Corp. including oversight of its $2 billion advertising budget, and at WPP.
In its own words: We are a digital-first, technology enabled marketing consultancy working at the crossroads of the art of science and creativity. We offer clients simplicity and speed at scale, built to ride the wave of marketplace disruption.
Mark Penn, managing partner; Jay Leveton, partner; Beth Sidhu, CMO and chief operating officer
The Stagwell Group/1808 I St. NW, Floor 6, Washington, 20006/Phone: (917) 765-2638