Proposed sale of 60% of Kantar

Mark Read

Mark Read

July 12, 2019 - Investment by Bain Capital Private Equity values Kantar at c.$4.0bn; WPP leverage target to be met a year ahead of plan; c.£1.0bn shareholder return planned

Transaction highlights

  • Bain Capital Private Equity’s (“Bain Capital”) acquisition of 60% of Kantar creates a strong partnership with WPP to accelerate the development of Kantar

  • Further simplifies and repositions WPP for growth, whilst unlocking significant value for shareholders

  • Kantar valued at c.$4.0bn (c.£3.2bn1) in the proposed transaction, equivalent to a multiple of 8.2x 2018 Kantar headline EBITDA2

  • Proceeds to WPP on completion after tax and continuing investment in Kantar expected to be c.$3.1bn (c.£2.5bn)

  • Potential value upside for WPP shareholders from 40% equity stake in Kantar

  • WPP to retain c.60% of net proceeds to reduce debt to the low end of the target leverage range of 1.5 – 1.75x average net debt/EBITDA3 for 2020

  • Balance of proceeds, c.$1.2bn (c.£1.0bn), to be returned to shareholders

  • Impact of proposed transaction and use of proceeds expected to be marginally dilutive to headline EPS in 2021

  • Completion and associated proceeds relating to no less than 86% of Kantar expected in early 2020, subject to approval by WPP shareholders and other customary regulatory and legal approvals

Mark Read [pictured], Chief Executive Officer, WPP, said: “Kantar is a great business and we look forward to working with Bain Capital to unlock its full potential. As a strategic partner and shareholder in Kantar, WPP will continue to benefit from its future growth while our clients continue to benefit from its services and capabilities. I would like to thank Eric Salama, his team and everyone at Kantar for their tremendous contribution to WPP – a contribution that will continue as we develop the business together. More...