WPP is said to weigh options for 40% stake in Bain’s Kantar

WPP is said to weigh options for 40% stake in Bain’s Kantar

WPP is considering options to exit its 40% stake in market-research business Kantar as the British owner of advertising agencies seeks to raise cash and address a faltering share price, according to people familiar with the matter. The London-based company is working with an adviser as it studies potential alternatives, including an outright sale of the holding that it retained after selling 60% of Kantar to buyout firm Bain Capital in 2019, the people said, asking not to be identified as the matter is private.

A deal could given an equity value of about $3 billion to $4 billion for Kantar, which also has around $4 billion of debt, the people said. One of the options being considered is to sell the stake to Bain, but alternatives such as a potential initial public offering of the business also are under consideration, the people said.

WPP could also decide to retain its ownership in the business if it can’t find viable options for the stake, the people said. WPP shares jumped as much as 1.3% after Bloomberg News reported that the company was considering options for the stake. Representatives for WPP and Bain Capital declined to comment.

WPP slashed its outlook for revenue growth in October after reporting sluggish sales, blaming shrinking spending from the technology industry and China’s weak economy. Cutbacks from technology clients, which have hit the advertising industry as a whole, deepened in 2023, chief executive officer Mark Read said at the time. WPP shares have fallen 14% in the past year and they’re 61% below their all-time high from 2017.

The 2019 sale of the controlling stake in Kantar, which valued the entire business at $4 billion including net debt, was part of Read’s push to cut debt and simplify WPP’s network of more than 100 agencies after ditching his predecessor Martin Sorrell’s acquisition-fueled growth strategy.

Follow us onTwitter,Instagram,LinkedIn,Facebook