Dentsu Aegis Network snaps up remaining Merkle shares a year early

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Dentsu Aegis Network (DAN) now has complete ownership of Merkle shares after accelerating purchase of the remaining shares of Merkle. Before the signing, DAN owned 66% of Merkle shares with an option to buy the remaining 34% in Q3 2021. As per the initial agreement, payment will still be made in Q3 2021.

According to DAN, the decision to bring the full purchase forward secures the expertise and knowledge of Merkle’s senior management team. It also strengthens the network’s CRM line of business and its ability to offer clients integrated solutions across creative, CRM and media. Additionally, the move allows the deployment of key Merkle talent to global roles across DAN. DAN acquired Merkle in 2016, a deal which the Wall Street Journal previously estimated to be worth US$1.5 billion. Merkle works with brands including Dell, T-Mobile, Samsung, GEICO, Kimberly-Clark, Sanofi and NBC Universal.

Toshi Yamamoto, president and CEO, Dentsu Group, and acting executive chairman and CEO, DAN, said at a time of considerable uncertainty, this agreement provides clarity to its employees, clients and stakeholders. He added that Merkle is the market leader in data, analytics and CRM and this accelerated integration will help to further future-proof the business, enabling revenue growth and improving operating margins globally.

“Merkle represents the highest growth area of the overall business. For our clients, the acquisition has already been transformative, positioning us as world leaders in delivering fully integrated services and solutions across the marketing mix, alongside our Media and Creative offerings, helping our clients to win, keep and grow their best customers," he said.

Meanwhile, David Williams, founder and CEO, Merkle and chairman, DAN, Americas, said the announcement is a positive step in its full integration solidifying the future of the team as central to DAN’s strategic ambitions.

"It provides us all with materially more flexibility to deliver integrated solutions for our clients, working alongside our talented colleagues across DAN’s media and creative offerings. In addition, the economics of Merkle are now fully linked to Dentsu’s thus empowering us as ‘one dentsu’ to move with agility as we emerge from the challenges of coronavirus, together," Williams added.

The announcement comes shortly after DAN recently nabbed Wendy Clark from DDB to helm the global CEO role, effective September this year. Meanwhile, the network is also implementing cost saving measures as a result of COVID-19 business impacts. The measures include implementing an immediate hiring freeze, delaying salary reviews in 2020 and temporary salary reductions with the top management team taking the highest percentage cut.