Two Advertising Giants to become One

Omnicom and Publicis two of the world’s biggest advertising giants said on Sunday they were going to merge. The move will be a $35.1 billion hookup across borders that shows Big Data has made Madison Avenue look more and more like its Wall Street.

The merge of U.S. based Omnicom Group with Publicis Groupe of France has a goal of restoring the power balance between ad agencies and the companies in Silicon Valley like Facebook and Google.

Nearly 22% of all spending globally for advertising is digital and that share is expected to increase to over 27% before the end of 2017.

Publicis and Omnicom hope that merging will allow them to be better equipped for an ad industry that is increasingly dominated by analysis that is date driven along with automated trading of space for advertising.

The market is still quite small for automated purchasing of space, but is fast growing. According to a big analysis firm on Internet, advertisers in the U.S. will spend over $3.4 billion on real time biding during 2013, mostly from display ads online.

The two companies merging into one will have co-CEOs, with Maurice Levy the current CEO of Publicis remaining and John Wren the Omnicom CEO remaining at their positions for the first 30 months.

Following that, Levy, who started the talks, will become a nonexecutive chairman, while Wren will continue his CEO duties. Levy is 71, while Wren is just 60.

The new company will be known as Publicis Omnicom Group and will encompass combined revenues of close to $23 billion, which overtakes WPP Group’s $15.95 billion in revenue it posted in 2012.

The companies hope the deal will be closed before the end of 2013 or early in the first quarter of the following year, though it might face some antitrust scrutiny.

Omnicom owns BBDO, OMD and TBWA Worldwide, while Publicis owns Saatchi & Saatchi, Leo Burnett and media buyer Starcom MediaVest, along with Razor Fish a digital agency.

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