WPP Group is strengthening its presence in Asia’s third biggest ad market by taking virtual control of Korean agency LG Ad.
The holding company is buying a 36% stake in the shop – Korea’s second largest – to become the leading shareholder. LG Ad will henceforth fall under the aegis of Ogilvy & Mather Worldwide and Young & Rubicam Advertising, and an executive from each will be appointed to its board.
Valued at around £91 million ($143m; €143m), the Korean agency posted revenues of £29.9m last year and has over 500 staff. It was previously part of the LG Group conglomerate, but is being sold off ahead of the latter’s flotation.
WPP chief executive Sir Martin Sorrell said the buy reflected Korea’s economic success. The nation’s ad market, currently worth £3.5 billion, is thought to have good long-term growth prospects.
“We have been relatively under-represented in Korea, and this investment reflects our wish to remedy that,” he declared. “It also allows us to take the experience of Korea – as perhaps the market in the world which is most successfully developed in terms of the integration of internet broadband and conventional media – to the rest of the world.”
LG Ad’s clients include former LG Group siblings LG Electronics, LG Chemical and LG Telecom, as well as Korean Air and Nike.
Data sourced from: BrandRepublic (UK); additional content by WARC staff