Interpublic Group Agrees to Acquire Acxiom Marketing Solutions ("AMS") to Lead Next Wave of Innovation in Data-Driven Marketing
Combination Brings Together Premier Media and Marketing Agencies with Leader in Data and Personalized Messaging
Opportunities and benefits for brands and CMOs:
- Unmatched outcome-driven services delivering targeted brand experiences that integrate disparate channels, technologies, and data
- Comprehensive suite of offerings include data strategy and management, audience creation, performance media, planning and buying, and analytics
Ethically sourced data, rooted in respect for the consumer:
Acxiomis a pioneer and thought leader in data stewardship
- Coupled with IPG's long-standing commitment to transparency in its media practices, AMS's focus on data ethics will result in a differentiated offering
- With AMS, IPG will deliver a foundational data asset to clients, based on a data set covering two-thirds of the global population
Financial benefits of transaction:
- Accretive to IPG in the first year after close, on adjusted EPS basis
- Strong AMS business, grounded in long-term contractual relationships, diversifies IPG's revenue and earnings mix
- Developing data-led offerings, across the holding company, will further position IPG to accelerate future revenue and earnings growth
- IPG remains committed to a strong balance sheet, maintaining solid investment-grade credit metrics, and continuing to grow our dividend
The deal combines IPG's media, creative, marketing services and analytics capabilities, global scale and consumer insights, with AMS's unrivalled expertise in data management. With the acquisition, the Acxiom brand name will become part of the IPG portfolio; the transaction does not include the LiveRamp business of
"In a world where everything is becoming data-driven, Acxiom Marketing Solutions offers the deepest set of capabilities for helping companies navigate the complexity of creating personalized brand experiences across every consumer touchpoint," said
"Everyone knows how valuable data is, but for most businesses it remains an under-leveraged asset. There also remains a great deal of uncertainty on how best to combine data with the creation and delivery of marketing messages. Our goal is to solve for those opportunities," added
"This transaction is a great outcome for both
Acxiom Marketing Solutions is the leading provider of data solutions for delivering real-time customer experiences, and includes all of
Data Management Services - taking multiple marketing data and related technologies, including databases, data lakes, ad platforms, and combining them into a simple unified data layer with a complete omnichannel view of customers.
Data Strategy Services - providing clients with a prioritized roadmap for optimizing the use of data and marketing technology.
Analytics Services - delivering independent services for measuring marketing ROI, attributing impact, deepening consumer insights and predicting consumer behavior.
Audience Creation Services - creating ideal audiences through look-alike modeling, advanced scoring, custom segment creation and traditional packaged data offerings.
Summary Terms of Transaction
The transaction has been unanimously approved by the boards of directors of both companies and is anticipated to close before year-end 2018. Completion of the transaction is subject to approval by
The purchase price represents a multiple of 11.5x AMS's 2018 estimated EBITDA, net of the benefit of the tax step-up.
IPG has a fully committed
Transaction Will Result in Attractive Financial Benefits
IPG expects the deal to be accretive in the first year after close on an adjusted EPS basis. Adjusted EPS excludes the expense for the amortization of acquired intangibles. IPG expects to build significant incremental revenue and earnings opportunities over time that neither company could obtain on a standalone basis. Additionally, the combination expands profitability metrics on a pro forma basis.
AMS Provides IPG with Significant Diversification Benefits
AMS will represent approximately 8% of the combined company's revenues, diversifying IPG's revenue base by client and practice discipline, and adding long-term, contracted revenue streams.
Strong Commitment to Preserve Balance Sheet and Maintain Ratings
IPG remains committed to a strong balance sheet and maintaining solid investment-grade credit ratings. In addition, share repurchases will be temporarily suspended.
Citi and J.P. Morgan are serving as financial advisors and providing committed debt financing, and
Conference Call/Webcast on
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About Acxiom Marketing Solutions
Acxiom Marketing Solutions is the leading provider of data solutions for powering exceptional customer experiences and includes all of
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This release contains forward-looking statements. Statements in this release that are not historical facts, including statements about management's beliefs and expectations, constitute forward-looking statements. These statements are based on current plans, estimates and projections, and are subject to change based on a number of factors, including those outlined under Item 1A, Risk Factors, in our most recent Annual Report on Form 10-K. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update publicly any of them in light of new information or future events.
Forward-looking statements involve inherent risks and uncertainties. A number of important factors could cause actual results to differ materially from those contained in any forward-looking statement. Such factors include, but are not limited to, the following:
potential effects of a challenging economy, for example, on the demand for our advertising and marketing services, on our clients' financial condition and on our business or financial condition;
our ability to attract new clients and retain existing clients;
our ability to retain and attract key employees;
risks associated with assumptions we make in connection with our critical accounting estimates, including changes in assumptions associated with any effects of a weakened economy;
potential adverse effects if we are required to recognize impairment charges or other adverse accounting-related developments;
risks associated with the effects of global, national and regional economic and political conditions, including counterparty risks and fluctuations in economic growth rates, interest rates and currency exchange rates; and
developments from changes in the regulatory and legal environment for advertising and marketing and communications services companies around the world.
Investors should carefully consider these factors and the additional risk factors outlined in more detail under Item 1A, Risk Factors, in our most recent Annual Report on Form 10-K.
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