According to a new report by consulting firm R3, agency holding groups participated in 15 out of 18 M+A deals in the APAC region in the first half of 2018, amounting to around US$273 million in value. Omnicom, Publicis, Hakuhodo and IPG all increased their activity in the region compared to the same time last year while three of the holding groups also hauled in a higher deal value over H1 2018.
Dentsu and WPP saw a decline in M&A activity year on year – both holding groups are usually active in APAC – though WPP has been at the centre of discussions of late. In mid-July, Chinese tech giants Tencent and Alibaba were reported to have expressed an interest in a minority stake of WPP China, estimated to be around 20%, though the deal is believed to be a long way from complete.
Media specialists were the most popular targets for acquisition overall, at 21% of all completed deals, while creative agencies came in second at 17% overall.
“The demand for local media specialists drove a large percentage of the marketing M&A activity in the first half of this year. The unique media landscapes of several APAC markets – particularly China – are driving consultancies and unconventional buyers to seek out experts in this space to boost their own capabilities,” said Sabrina Lee, in comments reported by Marketing Interactive, managing director of R3 China.
In contrast to the rest of the world, almost a third - 30% - of the regions’s M&A deals fell under the “others” classification, which also includes a variety of research firms, media owners, health-focused agencies and direct marketing specialists.
Sourced from R3, Marketing Interactive, WARC; additional content by WARC staff