WPP has announced that it will sell a 60 per cent stake in its market research business Kantar to private equity firm Bain Capital for around $US3.1 billion ($A4.4 billion), and that it plans to return $US1.25 billion to shareholders.
Furthermore, WPP believe the deal values all of Kantar at around the $US4 billion-mark. It will reportedly use the proceeds of the sale to reduce debt.
Completion of the deal is not expected until early next year and remains subject to approval from WPP’s shareholders.
Commenting on the sale, WPP CEO Mark Read (main photo) said: “Kantar is a great business and we look forward to working with Bain Capital to unlock its full potential. As a strategic partner and shareholder in Kantar, WPP will continue to benefit from its future growth while our clients continue to benefit from its services and capabilities. I would like to thank Eric Salama, his team and everyone at Kantar for their tremendous contribution to WPP – a contribution that will continue as we develop the business together.
“This transaction creates value for WPP shareholders and further simplifies our company. With a much stronger balance sheet and a return of approximately eight per cent of our current market value to shareholders planned, we are making good progress with our transformation.”
Luca Bassi, a managing director at Bain Capital Private Equity, said: “Kantar is a market leader in many areas and we are excited to be partnering with its management team and WPP to build on this remarkable platform for growth. We see many opportunities for expansion and will invest in technology to expand the company’s capabilities and reinforce its global leading position.”
Eric Salama, CEO, Kantar, said: “Our new ownership structure presents a great opportunity for Kantar, our employees and our clients. In Bain Capital we have a partner who shares our ambition, brings relevant expertise and – with WPP – can help us accelerate our growth and impact for clients. We are focused on delivering ‘human understanding at scale and speed’ and the ‘best of Kantar’ more consistently. We will do so by investing more in talent and by becoming a more technology-driven solutions provider.”