Maurice Levy / Getty
/ By Stanley Green /
Reports within the world of advertising have it that the long forecasted merger between Omnicom and Publicis, individually the world’s second and largest advertising agencies, are on the verge of announcing a multi-billion-dollar merger. A merger which Levy has been looking to make for a number of years.
The global advertising industry is pulsating with the news that the US-based Omnicom Group Inc. and France’s Publicis Groupe SA, are on the verge of signing a merger deal which create the world’s largest advertising conglomerate with a combined market value of $32 billion.
Insider reports have it that the soon to be irrevocably joined company will be known as the Publicis Omnicom Groupe, with current Omnicom Chief Executive John Wren joining forces Maurice Levy of Publicis to become joint CEOs of the soon to be formed global advertising monster.
The prospect of such a massive deal going through has certainly captured the imagination of Madison Avenue, due to the mouth watering thought of some of the world’s best-known and influential advertising agencies operating under a single umbrella.
Omnicom operates a number of leading advertising agencies, with the best known being BBDO, TWBA Worldwide as well as media buying specialists OMD, with a client base including such global leaders as McDonalds. On the other side of the deal, Publicis will be bringing in such advertising industry icons as Leo Burnett, Saatchi & Saatchi as well as an equally large and influential media-buying firm Stardom Mediavest. Among the clients list at Publicis are perfume and cosmetics giants L’Oreal, chemicals kings Procter & Gamble and French based car manufacturers Renault.
One major hurdle that the companies will have to find a way of getting over once the merger has been completed, is the delicate one of conflicts of interest, with many of the advertising agencies that are part of both groups handing the accounts of major rivals within various industry sectors. One particularly outstanding example is the so-called “Cola Wars” with Omnicom handling the advertising campaigns of Pepsi while Publicis does the same job for Coca-Cola.
Industry experts predict that it is almost inevitable, after a merger of such a scale, the new company stands to lose some major clients, which in itself is liable to cause a knock on effect within the advertising world.
According to industry estimates the estimated combined total of the two companies would be around the $23 billion mark, leapfrogging Sir Martin Sorel’s WCC whose annual turnover is around $16 billion.
Maurice Levy, who now that the age of 71 has shown an interest standing down as CEO at Publicis, has always had an eye for the future. That’s the reason why the company has become increasingly active in the digital advertising sector, acquiring such market leaders as Digitas, LBI and Razorfish. Acquisitions that have presented Publicis with a very strong footprint in the sector, while Omnicom, according to industry observers, have lagged behind.
If, as expected, the merger goes through, the newly combined, companies would be able to pool their considerable resources to face fast-growing competition in the ever emerging digital advertising sector.
The prospects of the two global advertising giants to come together as one also make a tremendous difference in their influence within the world’s emerging markets. Both companies have been increasingly aggressive in expanding markets such as China and Brazil over the past few years.
If and when the merger deal is signed, it is liable to be the subject of considerable government scrutiny, particularly relating to the lucrative ad buying divisions of both companies, who now have a combined annual budget of $100 billion, amounting to 20% of the entire global media business, and would totally dominate the sector.
Maurice Levy, was born and raised in Oujda a French protectorate in Morocco. After building a reputation as a rising star in the world of advertising, Levy joined Paris, France based Publicis in 1971, taking up the role of the company’s IT Director.
Levy’s dynamism and vision saw climb to the top at Publicis and was eventually appointed successor to the company’s founder and CEO Marcel Bleustein-Blanchet, when he stepped down in November 1987.
Since taking charge at Publicis, Levy has been recognized within the industry as the power that has pushed it into one of the leading forces in the world of advertising. For many years rumors have been rife that Publicis would ultimately either acquire or merge with another of the major ad holding corporations.