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Omnicom, Publicis to merge

Omnicom Group of New York and Publicis Groupe of Paris have reached an agreement to merge into a new entity called Publicis Omnicom Group. Publicis and Omnicom shareholders will each hold approximately 50% of the new company. Combined, the two firms have a market value of US$35.1 billion, 130,000 employees and 2012 revenues of $22.7 billion, making the merged entity the largest advertising agency in the world. Publicis Omnicom Group will be headquartered in The Netherlands, but will maintain its operational head offices in Paris and New York.

The merger will put a wide range of communications agencies under a single umbrella. Publicis subsidiaries include Leo Burnett, Publicis Worldwide, Saatchi & Saatchi, BBH, MSLGroup, Starcom MediaVest Group, ZenithOptimedia, Publicis Healthcare Communications Group, DigitasLBi, Razorfish, Rosetta and VivaKi. Omnicom's agencies include BBDO, DDB, TBWA, Fleishman-Hillard, Ketchum, OMD, Interbrand, RAPP, Proximity, CDM and Goodby, Silverstein & Partners. It is unknown at this time how potential client conflicts will be resolved.

For its first 30 months, Publicis Omnicom will be jointly led by co-CEOs John Wren and Maurice Lévy, now CEO of Omnicom and CEO of Publicis Groupe respectively. After this, Lévy will become non-executive chairman and Wren will continue as CEO. The board of directors will consist of seven additional members from each company.

"The communication and marketing landscape has undergone dramatic changes in recent years including the exponential development of new media giants, the explosion of big data, blurring of the roles of all players and profound changes in consumer behavior,"said Lévy "This evolution has created both great challenges and tremendous opportunities for clients. John and I have conceived this merger to benefit our clients by bringing together the most comprehensive offering of analog and digital services."

"Both Maurice and I believe this new company reflects our vision of retaining the best talent, attracting an incredible roster of clients and leading innovation," said Wren. "Omnicom and Publicis Groupe are reshaping the industry by setting a new standard for supporting clients with integrated messaging across marketing disciplines and geographies. This combination will enable us to leverage the skills of our exceptionally talented people, our broad product offering, enhanced global footprint, and tremendous roster of global and local clients."

The deal remains subject to approval by the shareholders of both companies and by regulators in the United States and France. It is expected to close in the fourth quarter of 2013 or the first quarter of 2014.

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