Dentsu‘s endeavours to sell its global unit of agencies is close to collapse, after potential trade buyers and private equity suitors walked away from talks to buy the Japanese agency’s underperforming international arm.
The development is expected to ramp up pressure on the Japanese firm’s executives.
A Financial Times article detailing the difficulties Dentsu to sell triggered an 11 per cent fall in the Japanese agency’s share price on the Tokyo Stock Exchange, although the group said in a media statement that no final decisions had been made.
Dentsu has been underperforming for some time; profits plunged in the 12 months to December 2024, with a $64 million loss. In October 2025, group financial filings to ASIC put accumulated losses at $1.1 billion.
The FT reported last year that Dentsu was exploring the sale of its UK-based international business, which made more than $4.5 billion in net revenues in 2024, as part of a strategic review.
Prospective buyers to have held discussions with Dentsu included major advertising groups and a range of private equity firms. However, the last trade buyers and private equity firm Apollo dropped out of talks last year, reported by the FT, leaving only Bain Capital.
A person close to Bain said the US private equity firm was “still interested, but with significant reservations”, the FT reported.
Dentsu president Hiroshi Igarashi informed board members that Bain was unlikely to continue with talks over a deal and that the sale process had fallen apart, according to people close to the advertising group’s top management, the FT revealed.
People close to Dentsu also said the group feared shareholders might attempt to unseat Hiroshi Igarashi at the annual meeting in March, by voting against his reappointment.
Japan’s largest agency is expected to inform investors at its full-year results meeting next month that its attempts to finalise a sale have failed, and that the company would seek to turn around its faltering international operations on its own.
The group has unveiled plans to restructure the international businesses, including cutting more than 3,400 jobs.
“With regards to the international business, the company is rebuilding the business foundation and re-evaluating underperforming businesses. At the same time, the company is exploring strategic alternatives to enhance corporate value but no decision has been made at this time,” Dentsu said.
Dentsu, whose tremendous oversight of the Japanese advertising market gives it considerable influence within the country’s business and political circles, has struggled to translate that control outside Japan.
The challenge to unload the international business has followed numerous failed ventures to turn around the operations. It has left the Japanese group confronting a disgruntled investor base that includes Oasis, an often vocal activist shareholder.
Dentsu’s international operations include Tag, Dentsu Creative, Merkle, iProspect, dentsuX and Carat.
Potential buyers had deemed Dentsu’s international business too difficult to turn around given the downward trend in its performance, the FT reported.
One Dentsu shareholder said they had “little confidence” in the company’s ability to steer the international business in an upwards direction, and that the group was impaired by an outdated approach to a market undergoing huge changes.
