PR M&A activity drops in the UK as agencies eye European clients

The number of PR M&A deals have fallen in the first quarter of 2017, according to research by Results International. Volumes are down in the UK but rose in Western Europe.

There was a total of 219 M&A deals completed in Q1, which is down from 238 in Q4 last year. However, while deal volumes fell in the UK – with 24 deals versus 39 in Q4 last year – the number of deals rose in Western Europe – from 51 in Q4 2016 to 61 in this year’s first quarter.

Results International says buyers are increasingly looking to acquire in continental Europe to service clients on a global scale.  This strategy can be seen in Accenture’s recent acquisition of SinnerSchrader, one of the leading independent agencies in Germany.

WPP lead the way with the largest amount of deals, making nine acquisitions in Q1 2017 with a focus on emerging markets, including India, China and Brazil.

The research also highlighted several marcoms sectors seeing an increase in activity in Q1: there were 10 shopper marketing deals (up from three in Q4 2016), including Bain Capital’s acquisition of Daymon Worldwide (USA) for $413m and HLD Associés remaining stake acquisition of Tessi in France for $150m.

Julie Langley, partner at Results International, comments: “WPP is back on top for deal volumes, when you add in Publicis getting back into M&A and continued activity from Dentsu, it underlines that quality targets are still very much sought after by both established and emerging players.

“There are many different types of buyers that understand the value of a marcoms presence to reinforce and supplement what they’re trying to offer and give them more influence over the c-suite. This is the widest buyer universe we’ve seen and it continues to expand with new entrants and emerging holdcos continuing to bolster activity from the traditional acquirers, consultancies and technology players.

“Brexit is yet to have much impact on M&A but the consequences may be more apparent in terms of client budgets as brands take longer to define spend, and there is also increasing scrutiny across a number of marketing services disciplines. Overall though, the M&A market continues to be an exciting environment for agencies looking to drive growth and value.”

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