WPP to sell stake in FGS Global to KKR for US$775m

WPP is selling its majority stake in FGS Global to Kite Bidco, an entity controlled by investment funds managed by Kohlberg Kravis Roberts & Co. (KKR) for US$775 million. 

This strategy started with the merger of Finsbury, The Glover Park Group and Hering Schuppener in 2021, the subsequent acquisition of Sard Verbinnen in 2021 and the introduction of KKR as a minority shareholder in 2023.  

This move better positions WPP to focus on and invest in its creative, media and corporate and consumer public relations businesses to deliver growth while strengthening the Group’s balance sheet. 

The consideration for the sale of WPP’s 50% stake at an enterprise value of US$1.7bn is US$775m payable in cash at completion.

The total cash proceeds payable on completion of US$767m will be used to reduce WPP’s debt, enabling it to invest in the growth of its businesses, pay dividends and return surplus capital to investors over time. The transaction has no impact on WPP’s current year or medium-term guidance and is expected to be broadly earnings neutral in 2025. 

Mark Read, CEO of WPP, said: “The sale of FGS represents an excellent outcome for WPP. Together with the management of FGS we have built a world-leading strategic communications and advisory group, creating considerable value for all stakeholders.”  

“We have achieved an attractive price, enabling WPP to accelerate the crystallisation of the significant value created. This also provides WPP with greater financial and management flexibility as we continue to grow our core business including Burson and Ogilvy Public Relations which give our clients access to world-class public relations services,” Read added. 

Alexander Geiser, global CEO of FGS, added, “Over the past four years, we have built one of the world’s leading strategic communications and advisory businesses from three independent consultancies and the addition of Sard Verbinnen. I would like to thank WPP for their help and long-standing collaboration in growing our firm.” 

“We are thrilled by the continued support of KKR, who also share our vision and strategy to be the leading advisor helping clients navigate the increasingly complex stakeholder economy. KKR’s exceptional investment track record, extensive experience and global resources will be invaluable as we further grow our integrated solutions globally as a standalone firm,” Geiser added. 

Philipp Freise, partner and co-head of European private equity at KKR, stated: “Our investment in FGS reflects our strong commitment to strategic partnerships, where we provide long-term capital and global resources to entrepreneurial teams and world-class businesses. We strongly believe in FGS’s strategy and leadership and have been pleased with our partnership since our minority investment in July 2023.” 

“In today's increasingly complex stakeholder ecosystems, the value of FGS’s insight, advice and execution is increasingly essential for organisations to navigate uncertainty and achieve their goals. We look forward to continuing our collaboration and helping FGS realize their vision as a global category leader,” Freise added. 

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