Omnicom and IPG have cleared the last regulatory clearance required to complete the acquisition, gaining antitrust approval from the European Commission.
As a result, Omnicom Group’s US$13 billion (A$20.1 billion) acquisition of IPG Mediabrands is expected to be closed in the coming days.
Based on its investigation, the Commission found that the merged entity would hold moderate market positions on such markets. Moreover, the merged entity would be sufficiently constrained by the presence of several competitors, including large international advertising groups with a global reach, such as WPP, Dentsu-Aegis, Publicis and Havas.
The commission also found that should the merged entity increase its prices or decrease the quality of its services, customers would have the ability to switch to one of the several competing agencies that would remain active in the market after the transaction.
And should the merged entity try to use its position on the market for the provision of media buying services (MBS) to increase its negotiating power with media owners, the latter would maintain sufficient countervailing power due to the significant degree of concentration of media owners in the relevant European countries.
The Commission therefore concluded that the proposed transaction would, on balance, be unlikely to raise competition concerns on any of the markets examined in the European Economic Area and cleared the transaction unconditionally.
Omnicom announced in December last year that it would acquire IPG.
It will be an all-stock transaction with IPG shareholders receiving 0.344 Omnicom shares for each share of IPG common stock they own. Once the ink has dried on the deal, Omnicom shareholders will own 60.6 per cent of the combined company.
IPG shareholders will own the remainder.
