Sapient becomes $3.7bn 'jewel in Publicis' crown'

3 November 2014

Publicis Groupe is to acquire Sapient, in a US$3.7 billion move to bolster its digital capability. It includes Razorfish, SapientNitro, DigitasLBi, Sapient Global Markets, Sapient Government Services, and Rosetta.

Following its unsuccessful “merger of equals” with Omnicom, the French holding company has successfully acquired Sapient in a deal that equates to $25 per share for Sapient shareholders.

It believes Sapient will be the “jewel in the crown” of the group, and will accelerate its growth profile and create cost synergies of €50 million. At its results presentation last week Publicis said that the failed merger with Omnicom had distracted the French company from driving growth.

Maurice Lévy, chairman and CEO of Publicis Groupe, said: “Sapient is a ‘crown jewel,’ a one of a kind company born in the technology space with strengths in marketing, communications, consulting and omni-channel commerce, all of which are equally important to best help clients achieve their digital transformation. It will also give Publicis Groupe access to new markets and create new revenue streams.

“This acquisition fulfills many of Publicis Groupe’s objectives: we will enhance our leadership position in digital, achieve our goal of deriving 50% of our revenues from digital and technology three years ahead of our 2018 plan, and leverage technology, consulting capabilities to expand in new verticals, and offering new and exciting opportunities to our talents.”

In a statement the group said: “This a major step for Publicis Groupe in growing the breadth of its digital offerings. This deal marks a milestone – not only for our two companies, but also for our clients and the marketing, advertising and consulting industries worldwide. With Sapient’s technology, built for the dynamics of an always-on world, Publicis Groupe will better innovate and will continue to leap ahead of the competition as a leading company built for the future."

Publicis claims the acquisition will make the group the world's “leading global communication, marketing, omni-channel commerce and technology group” with combined revenue in excess of €8 billion, combined EBITDA of approximately €1.3 billion. It will count 75,000 staff worldwide

The deal creates Publicis.Sapient, which the group claims will be the “world’s largest standalone global marketing technology and e-commerce platform”. Sapient CEO and co-chairman Alan Herrick will join Publicis Groupe's senior management team and become CEO of Publicis.Sapient.

Sapient founder Jerry Greenberg will also join the Publicis Groupe Supervisory Board.

The deal will mean more than half Publicis Groupe's revenue comes from digital, by the end of the year – three years ahead of the French group's target.

Sapient generated $1.4 billion in revenue for the year ending 30 June.

More news on Publicis and Omnicom below:

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