AUSTRALIA – WPP is expanding its relationship with STW Communications Group, a New South Wales-based marketing communications and content group of 75 companies, via a merger.
STW Communications will be consolidated with WPP’s operations in Australia and New Zealand. The value of the deal was not disclosed but WPP will become the majority shareholder of STW with a shareholding of 61%.
In a statement to the Australian Securities Exchange, rhe merged group will have pro forma normalised net sales of A$847 million and normalised EBIT of A$142 million.
The goal is to simplify the ownership structure of the business and align the interest of STW and WPP. The parties have joint ownership in businesses including Ogilvy, Ogilvy PR, J. Walter Thompson, Mindshare, Maxus and Added Value.
STW’s Chief Executive Officer, Michael Connaghan and CFO Lukas Aviani will continue to lead the merged business, while Robert Mactier will continue as independent Chairman.
“WPP has been a fantastic partner since we came together to create Singleton Ogilvy and Mather in 1998. Since then we have had great success in Australia and New Zealand partnering in J Walter Thompson, Added Value, Mindshare and Maxus,” said Connaghan.
“I believe this deal makes great sense. To finally align our shareholdings in those existing partnerships and now to expand our relationship across the full STW and WPP Australia and New Zealand portfolio of companies is an amazing opportunity.”
“Australia and New Zealand is our fifth largest market after the United States, the United Kingdom, Greater China and Germany,” WPP’s Chief Executive Officer, Sir Martin Sorrell, adds.
