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NEW YORK - Omnicom Group Inc. (NYSE:OMC) and The Interpublic Group of Companies, Inc. (NYSE:IPG) received final regulatory clearance for their merger from the European Commission on Monday, paving the way for the transaction to close by Wednesday. IPG, currently valued at $9.25 billion with a P/E ratio of 17.48, appears undervalued according to InvestingPro analysis.
The approval represents the last regulatory hurdle for the acquisition, which will create what the companies describe as the world’s leading marketing and sales company.
"The companies expect to close the transaction by the close of business on Wednesday," according to the press release statement.
The combined entity will bring together Omnicom’s data-inspired marketing solutions with IPG’s portfolio of communications specialists. Omnicom currently serves over 5,000 clients across more than 70 countries, while IPG’s global brands include Acxiom, FCB, McCann, and Weber Shandwick, among others. IPG has generated $8.74 billion in revenue over the last twelve months and offers an attractive 5.13% dividend yield. InvestingPro data shows IPG has maintained dividend payments for 15 consecutive years.
The merger, first announced earlier this year, has progressed through various regulatory reviews before securing this final approval from European authorities.
The companies have not disclosed specific financial terms of the transaction in the announcement.
Both Omnicom and IPG are publicly traded companies listed on the New York Stock Exchange. The press release notes that the combined organization will focus on delivering "intelligent growth" for clients, though specific integration plans were not detailed.
In other recent news, Omnicom Group has received unconditional approval from the European Union Commission for its $13.25 billion all-stock acquisition of Interpublic Group. This merger, announced in December 2024, will combine two of the world’s largest advertising companies. Omnicom also reported third-quarter earnings that exceeded analyst expectations, with adjusted earnings per share of $2.24 and revenue of $4.04 billion, both surpassing forecasts. The company’s revenue grew by 4.0% compared to the same quarter last year, with organic growth and favorable currency translation contributing to this increase.
In anticipation of the merger, Omnicom extended the expiration date of its exchange offers for Interpublic Group’s outstanding notes to November 28, 2025. This extension aligns with the expected completion of the merger by the end of November. Meanwhile, BofA Securities adjusted its price target for Interpublic Group’s stock to $87.00 from $90.00, maintaining a Neutral rating. The adjustment comes as Interpublic prepares for its acquisition by Omnicom, expected to close later this month. These developments mark significant changes in the advertising industry landscape.
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