IPG Confirms $2.3 Billion Deal to Acquire Data Marketing Company Acxiom
News shows holding group will not be sold, analysts say
Today, Interpublic Group confirmed rumors that it will pay more than $2 billion to acquire Acxiom, an Arkansas database marketing company that collects and distributes information drawn from an estimated 2.2 billion consumers around the world.
The holding company believes that this acquisition will help clients better target their ads while relying less exclusively on tools provided by tech giants such as Facebook and Google.
According to at least one prominent analyst, the news should put to rest all speculation about IPG going up for sale.
“The conclusion to draw is that IPG is willing to invest, period. It’s not something they’d done in the past 20 years,” said Brian Wieser of Pivotal Research Group. “This indicates that they’re moving forward as a standalone company.”
Specifically, IPG agreed to acquire the company’s Acxiom Marketing Solutions (AMS) division in a cash transaction valued at $2.3 billion. The deal received unanimous approval from the boards of directors at both companies. The bulk of Acxiom will now be a standalone unit within IPG’s media agency network Mediabrands, though the deal did not include data onboarding company LiveRamp, which the former acquired in 2014.
Earlier this year, Acxiom confirmed that it had launched two different strategic reviews: one to sell AMS and one to sell LiveRamp. Private equity firms were reportedly interested in the former.
As part of the move, Acxiom’s 2,100-plus employees will now work for IPG, reporting to chief data and marketing technology officer Arun Kumar and Mediabrands chairman Philippe Krakowsky.
“With this acquisition, IPG has an offering unlike any other holding company. We have the world’s premier media, creative and marketing communications agencies coupled with the world’s leader in personalized messaging, all under one roof,” wrote IPG CEO Michael Roth in an internal memo reaffirming how he believes Acxiom will help sell his agencies’ services to clients.
Roth also argued that the acquisition will help IPG stand out in terms of the ongoing debate over consumer privacy. “Acxiom has a global repository of data that covers 65 percent of the world’s population,” he wrote. “The data stack they have built has been ethically sourced, meaning consumer consent has been at the heart of the company’s DNA since its founding.”
“After careful consideration of a variety of options and potential partners, it became clear that a sale of AMS to IPG, with its scale and breadth of complementary services, represented the best possible path forward for our clients and associates,” read a statement from Acxiom CEO Scott Howe.
As if to reaffirm the significance of the deal, the press release also notes that AMS will account for nearly 8 percent of the new combined company’s overall revenues.
Citi and J.P. Morgan are serving as financial advisors on the deal, and IPG will host a call for investors tomorrow to discuss the acquisition. Acxiom corporate did not respond to a request for comment today.
