Two advertising giants called off their proposed $35 billion merger Thursday. Writing in The New York Times, David Gelles reports that Omnicom Group and Publicis Groupe shelved the plan due to a “mix of clashing personalities, disagreements about how the companies would be integrated and complications over legal and tax issues."
Gelles writes: “The collapse is a huge setback for both companies. When the merger was announced last summer, it was billed as an opportunity to create an international powerhouse with the capabilities to serve large and small clients alike with a mix of digital and traditional agencies.”
Since the merger was announced almost a year ago, not much progress had been made on the deal, the story adds. The companies hadn’t shared client contracts, for instance, and relationships between teams at the two companies “remained frosty.”
That extended to the top, with Omnicom Chief Executive John D. Wren and Publicis Chief Executive Maurice Levy clashing, the piece notes. Both executives are described as “strong-willed.”
One point of conflict was which company was acquiring the other, with Publicis executives taking issue with the idea that Omnicom executives would take control of both the CEO and CFO roles.
“It seems incredulous that this merger fell apart because of disagreements over roles and responsibilities,” Brian Wieser, an analyst at Pivotal Research Group, told The Times. “These are things that shareholders should have expected to be sorted out before the merger was announced.”