WPP AUNZ enters trading halt ahead of takeover outcome
Two weeks after WPP plc made a takeover bid for WPP AUNZ, the latter, ASX-listed company has entered a trading halt associated with that takeover.
In an announcement lodged with the ASX this morning, WPP AUNZ said the trading halt will lift this Friday, or when an announcement as to the takeover’s outcome is released, whichever comes first.
The company reiterated that WPP plc, the majority shareholder of WPP AUNZ with 61.5% ownership, is proposing to acquire all WPP AUNZ shares it does not already own.
The takeover bid comes a year into WPP AUNZ CEO Jens Monsees’ tenure. In that time, he has merged White Grey and Switched On into AKQA, disbanded the bespoke agency for Vodafone, Team Red, brought Geometry under the VMLY&R umbrella, acquired Perth agency Meerkats, and aggressively sought to transform the largest holding company in the market.
That transformation plan has involved a new leadership model and a ‘campus’ model, with WPP AUNZ agencies in smaller markets being united under one profit and loss statement.
At the end of October, the company reported third quarter earnings before interest and tax (EBIT) of $24.6 million thanks in part to cost cuts – the holding company is rolling out a $70 million cost savings program, saving $29 million in Q3 – and a $5.9 million Jobkeeper injection. Net sales were down 14.3% year on year to $153.6 million, compared to the market’s drop of 27.1% for the period.
“In the past, whoever was running the company were buying new businesses and new solutions, which was right, but they were not integrated,” Monsees told Mumbrella at the start of November.
“So they were standalone next to the others, and then you stack up a lot of brands and a lot of silos and solutions.
“The future, in a connected world and a digital[ly] connected world, is to actually be connected and collaborative as well. And that means to integrate. So, fewer but stronger brands.”
Monsees joined as CEO a little over a year ago
In 2016, John Singleton’s STW Group merged with WPP. Then CEO Mike Connaghan – who departed in 2018 and was replaced by recently-retired John Steedman until Monsees was hired – told Mumbrella at the time that the merger “should have happened a few years ago”.
“But it didn’t, for lots of different reason,” he said.
“It’s happened in a really interesting way; we’ve stayed listed and we’ve effectively acquired the businesses in Australian and New Zealand, so it is quite unique.”
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Brittney Rigby was Mumbrella's deputy managing editor - news and analysis. She left Mumbrella in April 2021.
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