WPP, investors adjust to life without Sorrell
WPP entered uncharted territory on Monday after the exit of founder Martin Sorrell left the world's biggest advertising company rudderless at a time of intense industry change.
Shares in WPP fell 6 per cent after Sorrell, the driving force behind 33 years of dealmaking and relentless expansion, stepped down on Saturday after the board investigated an allegation of misconduct.
David Herro of Harris Associates, WPP’s biggest shareholder according to Thomson Reuters data, said Sorrell would be missed. “Sir Martin is a visionary, a legend in advertising and a skilful businessman,” he said. “The circumstances surrounding this are regrettable as is a leadership transition without Sir Martin’s involvement.”
The sudden departure of Sorrell has sparked questions as to whether the holding group can remain in its current form of employing 200,000 people in more than 400 agencies across 112 countries. It has also prompted fears that without Sorrell’s contacts it could lose clients and talent.
“We think the lack of operational direction for the group and potential for client losses are clear downside risks over the short to medium term,” Deutsche Bank said.
WPP said chairman Roberto Quarta will become executive chairman while its digital boss Mark Read and Andrew Scott, the chief operating officer of WPP Europe, become joint chief operating officers.
WPP’s stock fell 6 per cent after Martin Sorrell resigned