Publicis Groupe SA and Omnicom Group Inc. shook up a sleepy summer weekend by announcing on July 28 that they would merge to form the world's largest advertising agency. The combined Publicis Omnicom Group (POG) would have a market capitalization of around $35 billion and annual revenues of $23 billion. POG would control $11 billion in U.S. ad revenue, more than a third of the $30 billion spent annually. The two companies billed the deal as a merger of equals, and each set of shareholders will own 50 percent of the combined entity. Publicis shareholders will receive one POG share and €1 for each of their shares, while Omnicom stockholders will get 0.813 POG shares per Omnicom share. Both companies' stock fell slightly on the news.
The two companies will be combined under a Dutch holding company whose shares will be traded in both Paris and New York. The companies hope to close the deal in the fourth quarter of this year or the first quarter of 2014, pending approval from regulators and both sets of shareholders.
