French advertising giant Publicis Groupe SA confirms 49% stake acquisition in Brazilian advertising company Talent

Comments Off | 10-9-2010

French advertising giant Publicis Groupe SA is to acquire a 49 per cent stake in Brazilian advertising firm Talent. There had been speculation with reports suggesting a possible deal between the two firms over a potential takeover earlier on. The French advertising major has embarked on a strategy for increased revenue from emerging markets that will see it undertake more acquisitions in places such as Brazil.

The acquisition of Talent brings Publicis closer to attaining its aims, mainly to accrue about a quarter of its revenue from emerging markets by the end of this year. For this Brazilian undertaking, the French firm will fork out an estimated $110 million according to estimates as the deal’s worth is not yet known. Based in Sao Paolo, the Brazilian firm offers a variety of advertising services such as creative, media planning and digital communication.

Talent has a per annum revenue of about 50 million Euros. Publicis might exercise the options to take a majority stake in the Brazilian firm at a later date, but when reached for comment over the plans, a company spokesman refused to comment. However, in a statement, Publicis said the Brazilian undertaking is in line with its strategy of targeted acquisitions that are meant to expand the firm’s leadership in high-growth markets like Brazil.

Brazil’s economy is one of the fastest growing economies in the world. In July, Publicis’ ZenithOptimedia unit predicted ad spending in Brazil will grow by 5 per cent in 2010, against a 3.5 per cent rise globally. The Brazilian investment comes as one amongst the many others Publicis has made in recent months in emerging markets. For instance, Publicis purchased majority stakes in two firms in India in addition to its recent acquisition of Brazilian independent digital agency AG2.

Publicis is targeting to get 25 per cent of its revenue from emerging markets by year-end, compared with about 22.1 per cent at the end of June. Advertising agencies are racing each other to snap up the best deals in emerging markets and prices are often high, particularly in Asia.

Publicis Groupe is a French multinational advertising and communications company. It is one of the big four global advertising holding companies (the others being Interpublic, Omnicom, and WPP). Publicis Groupe S.A. provides traditional advertising, media services, and specialized agencies and marketing services SAMS) to national and multinational clients. Its traditional advertising services principally involve the creation of advertising for products, services, and brands.

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Posted in FDI Brazil statistics, General |

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