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Dentsu to acquire Aegis for $4.9 bn
MUMBAI: In its first serious effort to challenge the bigger media agencies, Japanese media conglomerate Dentsu is buying out UK-based Aegis Media Group for a whopping $4.9 billion.
Joining the acquisition fever gripping the top media agencies, Dentsu‘s buyout of Aegis will place the Tokyo-based agency in the top position in the Asia-Pacific region while it becomes the second largest in western Europe, the fastest growing in North America and a global leader in digital markets.
The deal will also have India implications where Dentsu had expressed its ambitions to grow. In January 2011, it had bought out its local joint venture partner to take full control. The price: $2.4 billion for Sandeep Goyal-promoted Mogae Media‘s 26 per cent stake each in Dentsu Communications, Dentsu Marcom and Dentsu Creative Impact.
“Dentsu and Aegis independently were not too big a force in India. But the combined strength will provide the muscle power for them to build and grow strong in one of the fastest growing ad markets in the world,” said a top executive in a leading agency on condition of anonymity.
When contacted, both Dentsu and Aegis declined to comment on the deal.
A source, however, said the details would emerge only after the deal was consummated and complete. The entire realignment would follow after that, expected around April 2013. The first stage would be restructuring globally, followed by specific regions and then each country.
Dentsu expects the scheme of arrangement to become effective during October – December 2012, subject to anti-trust clearance and other conditions.
Overwhelmingly dependent on the home market for clients, Dentsu had earlier in its medium-term plan stated that it would focus on global business expansion and intensify its digital offerings while strengthening its mass media business.
Dentsu initiated talks with Aegis in June, eyeing the agency which analysts had speculated would look for a buyer. The selling of the Synovate unit to France‘s Ipsos was only to make that task easier for a suitor.
The Japanese agency was preparing the ground after terminating a nine-year partnership with Publicis in February. Selling off its shares to Publicis for €644.4 million, Dentsu had the cash to look for purchases that would allow it to penetrate into the UK, European and US markets.
The acquisition of Aegis will make Dentsu one of the leading global media and marketing company. In January, Aegis won the General Motors Co. contract worth $3 billion of yearly advertising.
Dentsu president and CEO Tadashi Ishii said, “I am pleased to announce this exciting and transformational combination between Dentsu and Aegis. Together, we will be able to deliver fully integrated and best-in-class services to our clients through a new global communication network born in the digital age offering a broadened service portfolio. Dentsu and Aegis will be the market leader in the Asia-Pacific region, enjoying a strong presence across Europe and the fastest growing agency network in the US.”
The best part is that Dentsu has hardly any overlap with Aegis. The combination will be complementary, bringing together a global media platform with capabilities to provide integrated solutions and offer enhanced quality services to clients.
The geographical fit is highly complementary. Dentsu has a leading market position in Japan‘s advertising and marketing sector, an established presence across Asia, and an increasingly expanding business in the US.
Aegis, on the other hand, enjoys a leading position showing strong presence across Europe and increasingly in the US. Moreover, Aegis is rapidly growing its footprint across emerging markets, and has established robust positioning in Asia excluding Japan.
Together, the enlarged group will be a stronger global competitor with the scope and scale to compete for and win international mandates across Japan, Europe, Asia Pacific and the Americas.
Also, following the transaction, the combined group will have a strengthened ability to offer a wider spectrum of niche services and expertise as a full service agency.
Dentsu faces strong client expectations to strengthen digital solutions. With the rise of digital consumption and client demand for digital services, Dentsu has successfully enhanced its digital solutions over the years. By integrating Aegis, with Isobar and iProspect‘s digital strengths in creative origination and performance marketing, the combined business will provide a powerful global platform for media, content and digital technology, and will increasingly support client activities.
The combination of Dentsu and Aegis, with its robust client portfolio, will count at least 71 out of the top 100 marketers as clients on a combined basis, and will provide global and local clients with a new, differentiated proposition to achieve their objectives, and also accelerate the drive to continuously create new innovations as one unified group, Dentsu said in an official statement.
Aegis CEO Jerry Buhlmann said, “This is a compelling combination of two great businesses that will create one of the world‘s most dynamic marketing services groups – and the first to be born in the digital age. We at Aegis are delighted at the prospect of being able to play a full part in helping Dentsu create a platform for global growth and continued digital innovation. By forming the first communications group with true global reach, the growth strategies of both businesses will be enhanced as we provide more scale, geography, capability and investment to support clients.”
MAM
Microdrama Specialist COL Group International Builds Out With Narativ, Rock Networks & BlingWood Deals
MUMBAI: Microdrama powerhouse COL Group International is building out its distribution network, with its CEO saying vertical video is about to enter its “next competitive chapter.”
The microdrama arm of publicly-listed Chinese company COL Group appointed Narativ Media as its official distributor in the Middle East and North Africa (MENA) and CIS regions and Africa, and a struck new content deal with a new Dubai-based microdrama platform.
The deals were unveiled this morning at MIP London, and also included Rock Networks as its exclusive Southeast Asia telco distribution partner for its app, FlareFlow. MIP London is now into its second day at the Savoy Hotel and adjoining IET London complex.
The deals come soon after COL appointed Harbour Rights to represent its titles in Europe and Latin America, as we reported yesterday in our extended feature on microdrama distribution.
COL’s Singapore-based microdrama unit says its “coordinated global distribution architecture and significantly expanded international content slate” would help to scale its catalogue to more than 1,700 microdrama titles worldwide. These hail from South Korea, Japan, Africa, the Middle East, Southeast Asia and the UK and roll out across Sereal+, FlareFlow and 17K.
A deal with Dubai-based BlingWood, which recently launched as an OTT platform, will expand COL’s access to Middle Eastern and Indian microdramas, and includes a broader pipeline of Indian series from storytelling platform Pratilipi, Korean titles from BeLive Studios and British reality-led formats from Tattle TV — the UK’s first dedicated microdrama app, including titles such as Dog Dates.
“Microdrama is entering its next competitive chapter, where quality, retention and monetization standards are increasingly shaped by data and operational discipline,” said Timothy Oh, General Manager of COL Group International.
“As pioneers in both China and the U.S., scaling some of the world’s leading platforms in this space, we understand what it truly takes to win sustainably. Our role is not simply to offer catalogue volume, but to help partners select, position and scale the right content for their platform and audience. By bringing together a broad, constantly refreshed slate from across regions, we enable smarter curation, clearer differentiation and long-term growth for serious industry players.”
Narativ deal
COL and UAE-based Narativ described their deal as a “strategic expansion of premium vertical content distribution across high-growth emerging markets,” and comes as the microdrama continues to boom financially. The growth of the medium will be among the key topics of conversation today at MIP London, where COL chief Oh will be speaking.
The pact extends beyond content representation and is being billed as part of a more “structured micro-drama distribution infrastructure.”
Narativ will spearhead market development, platform alliances, broadcaster relationships and digital monetization frameworks across the MENA and CIS regions and Africa, where they have identified “rapid mobile-first consumption growth and strong demand for short-form, high-engagement storytelling formats.”
“Micro-dramas are reshaping global viewing habits, particularly across mobile-first markets like MENA, Africa and CIS,” said Manjyot Sandhu, CEO and co-founder of Narativ. “Our appointment as official distributor for COL Group in these territories reflects Narativ’s strategy to build sustainable distribution architecture.
“A key pillar of the collaboration includes integration with FlareFlow, enabling strategic telco partnerships, bundled carrier offerings, and alternative monetization pathways designed to accelerate scale across mobile ecosystems and OTT platforms.”
Oh added: “We are building more than a content slate – we are building the global infrastructure for microdrama. With hundreds of new titles launching every quarter, scale and regional strength are critical. Narativ with its deep foothold in MENA, Africa CIS and other key markets makes them a natural strategic partner as we expand FlareFlow and bring microdrama to new platforms, telcos and audiences.
Narativ, which is joint venture Sandhu operates with Copyright Capital, manages around 7,000 hours of content and has a digital network spanning 150 million subscribers across 21 language.
COL Group has emerged as one of the biggest microdrama platforms, running platforms such as FlareFow. It is also a part-owner of ReelShort.
