The U.S. Federal Trade Commission (FTC) has given conditional approval to Omnicom’s proposed acquisition of Interpublic (IPG), requiring the merged entity to agree to a consent order that prohibits it from steering ad dollars away from media publishers based on their political or ideological views.
“Co-ordination among advertising agencies to suppress advertising spending on publications with disfavoured political or ideological viewpoints threatens to distort not only competition between ad agencies, but also public discussion and debate,” Daniel Guarnera, director of the FTC’s Bureau of Competition, said in a statement released Monday. “The FTC’s action today prevents unlawful co-ordination that targets specific political or ideological viewpoints while preserving individual advertisers’ ability to choose where their ads are placed.”
The proposed consent order aims to settle an FTC complaint that claims Omnicom’s acquisition of IPG would further “concentrate” the U.S. market for media buying services, potentially leading to anti-competitive practices. Specifically, the complaint alleges that advertising agencies have collaborated to boycott certain websites and apps, restricting ad placements based on unspecified criteria.
Omnicom and IPG issued a joint statement describing the consent order as “mutually acceptable.”
“This is an important step toward the completion of the proposed acquisition,” John D. Wren, CEO of Omnicom, said in the statement. “We continue to look forward to obtaining the remaining regulatory approvals and closing in the second half of this year, consistent with our expectations when we announced this transaction.”
The consent order comes after congressional investigations into claims that advertising agencies and brands, through the Global Alliance for Responsible Media, colluded to boycott certain platforms, including X.
According to Omnicom, the proposed acquisition of IPG, announced last December, would form the world’s largest agency company with combined 2023 revenues of $25.6 billion, eclipsing that of WPP. The deal surpasses the proposed merger between Omnicom and Publicis, announced in 2013 but ultimately cancelled in 2014, which would have created a company with combined revenues of $23.8 billion at the time.
After the deal’s approval, Omnicom shareholders will own 60.6% of the combined company, and Interpublic shareholders will own 39.4%, on a fully diluted basis.
Wren is expected to remain chairman and CEO, while Phil Angelastro will remain EVP and CFO of Omnicom. IPG CEO Philippe Krakowsky and Omnicom president and COO Daryl Simm, meanwhile, will serve as co-presidents and COOs of Omnicom.
– with files from Christopher Lombardo
