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MarketScreener Homepage  >  Equities  >  London Stock Exchange  >  WPP Group    WPP   JE00B8KF9B49

WPP GROUP

(WPP)
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WPP : shortlists final bidders for Kantar - sources

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05/16/2019 | 02:12pm EDT
FILE PHOTO: An usher holds a baton to guide attendees towards the AGM of advertising agency WPP in London, Britain

LONDON (Reuters) - WPP has shortlisted a series of U.S. buyout funds to submit binding bids for a majority stake in its data analytics unit Kantar as it wants to finalise the sale in late June, four sources familiar with the matter told Reuters.

Private equity firms Bain Capital, Apollo and Platinum have made it through to the final stages of the auction along with a fourth undisclosed bidder, the sources said.

The world's biggest advertising company held management presentations with the bidders on May 15, one of the sources said, and aims to wrap up the process towards the end of June.

Private equity investors have about four weeks to carry out in-depths checks on Kantar before submitting their final bids, this source said.

WPP declined to comment while Bain, Apollo and Platinum were not immediately available.

The auction, led by Goldman Sachs, kicked off last year drawing interest from a broad spectrum of financial investors including European private equity houses CVC Capital Partners and Permira.

Kantar generates about 15% of WPP's overall sales and provides brand and marketing communications research for some of the world's largest advertisers.

The business is valued at about 3.5 billion pounds, representing a multiple of seven to nine times its earnings before interest, tax, depreciation and amortization (EBITDA) of $550 million, two of the sources said.

Some investors have expressed concern over Kantar's business model which is being challenged by disruptive digital technologies.

The unit's underlying sales slipped 2 percent last year to 2.6 billion pounds with operating profits down 14 percent to 301 million.

The business has also traditionally weighed on the company's overall organic growth rates, a key measurement for the industry.

WPP new boss Mark Read has identified a Kantar sale as one way to bring in cash and help steer WPP back to growth.

While clients need access to data and customer insight, WPP does not need to own it outright, he believes.

Last year he pledged to spend 300 million pounds to restructure the group and bring it back in line with peers by the end of 2021.

(Editing by Alexandra Hudson)

By Pamela Barbaglia and Kate Holton

Stocks mentioned in the article
ChangeLast1st jan.
GOLDMAN SACHS GROUP INC. 1.57% 209.84 Delayed Quote.23.63%
WPP GROUP -1.18% 906.4 Delayed Quote.8.22%
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Financials (GBP)
Sales 2019 12 946 M
EBIT 2019 1 985 M
Net income 2019 1 076 M
Debt 2019 4 304 M
Yield 2019 6,50%
P/E ratio 2019 10,7x
P/E ratio 2020 10,7x
EV / Sales2019 1,23x
EV / Sales2020 1,22x
Capitalization 11 562 M
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Technical analysis trends WPP GROUP
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Mean consensus OUTPERFORM
Number of Analysts 24
Average target price 1 109,41  GBp
Last Close Price 916,20  GBp
Spread / Highest target 65,9%
Spread / Average Target 21,1%
Spread / Lowest Target -16,9%
EPS Revisions
Managers
NameTitle
Mark Julian Read Chief Executive Officer & Executive Director
Roberto Quarta Non-Executive Chairman
Andrew Grant Balfour Scott Chief Operating Officer
Paul W. G. Richardson Group Finance Director & Executive Director
Stephan Pretorius Chief Technology Officer
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