Sorrell sees off WPP in buy-up
SIR Martin Sorrell has beaten competition from WPP to make his first acquisition since being forced out of the advertising giant he founded over 30 years ago.
His new venture, S4 Capital, has paid £265million for Dutch digital agency MediaMonks, seeing off rival interest from WPP and Accenture Interactive
Sorrell, pictured, built WPP into the world’s biggest advertising group with more than 200,000 staff in 112 countries before resigning in April after an investigation into allegations of personal misconduct, which he denies.
He personally invested £40million in S4 as part of a £51million fundraising and has a further commitment for another £150million to fund acquisitions.
Backing for the MediaMonks deal is understood to have come from other investors and HSBC in a loan.
MediaMonks has revenues of about ¤110million (£97million) and operates in 10 countries including the US, UK, Europe, Asia, Latin America and the Middle East, employing more than 750 people.
Clients include Adidas, Amazon, Google and Netflix.
Sorrell said: “This represents a significant step in building a new age, new era, digital agency platform for clients. MediaMonks’ roots are totally in new media and data, content and technology.
“Our next moves will be to build this platform further and to add meaningful data analytics and digital media buying.
“The company will be a unitary one with MediaMonks as its core.”
Sorrell had pushed ahead with the deal despite a legal threat from WPP alleging he had broken a confidentiality agreement because he had looked at buying MediaMonks while he was still chief executive of the FTSE 100 group.
This has thrown into doubt his entitlement to share awards worth up to £20million in future payments from WPP as part of a long-term incentive plan.
A WPP spokesman said: “WPP’s lawyers wrote to Sir Martin’s lawyers last week pointing out the breach of his confidentiality undertakings in his approach to MediaMonks after his resignation from WPP.
“Despite subsequent protestations from Sir Martin’s lawyers, we are well aware of the facts and he has jeopardised his LTIP [long term incentive plan] entitlement.”