Omnicom Group, recently accused of misleading investors, still has to pay nearly $400 million (€405m; £259m) for acquisitions made before this year – higher than guidance given by the firm last month.
The agency giant tends to pay for purchases in two parts: first an upfront sum accounting for anywhere between 30% and 70% of the total; then the remainder, calculated according to the acquisition’s performance, paid over three to five years.
In a bid to be more open about its finances, Omnicom has released figures showing it faces post-purchase payments, or ‘earn-outs’, of $394.1m, with $376.5m to be paid before 2005 should the acquired businesses perform as expected. Last month, the group estimated that it had between $250m to $350m to pay by 2005.
Omnicom also revealed it spent $844.7m on acquisitions last year, including $433.1m in upfront payments for new purchases, $203.7m in earn-outs and $182.6m in strengthening existing stakes.
Data sourced from: AdAge.com; additional content by WARC staff