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Bloomberg
Interpublic Group of Cos, one of the world’s largest advertising companies, agreed to acquire Acxiom Corp.’s mark- eting-services unit for $2.3 billion, gaining tools to help clients sift through data to reach potential customers.
Acxiom expects to receive $1.7 billion in net proceeds, according to a statement. The company plans to repay debt, buy back stock and reinvest in its other business. Interpublic is the the owner of advertising companies including Craft, FCB and Magna, and intends to make the Acxiom name one of its brands.
The deal gives Interpublic strength in data-management, including information covering two-thirds of the world’s population. Ad companies are increasingly relying on techn- ology tools to prove they can do a better job than Google and Facebook Inc.
While the ad industry has struggled to adapt to the rise of data-driven online marketing, Interpublic has fared better lately than bigger rivals such as WPP Plc, in part because of a strong US business.
Following the sale, Acxiom plans to retire all of its debt. It will also begin a $500 million tender offer for its stock and increase an existing buyback authorisation to as much as $500 million, according to the statement.
The company will be renamed LiveRamp after a business that helps companies match customer data with information available through third-party services. Chief Executive Officer Scott Howe and Chief Financial Office Warren Jenson will remain in their current roles at the company, which will be headquartered in San Francisco.
Acximo rose 14 percent $34.21 at the close in New York. The company announced in February that it would conduct a strategic review of its assets. At the price, the entire company had a market value of $2.6 billion. Revenue totaled $917.4 million in 2017.
Interpublic fell 1.8 percent to $23.03, valuing the company at $8.9 billion. It had almost $600 million in cash and $2.09 billion in debt at the end of March, according to data compiled by Bloomberg. Based in New York, Interpublic had 2017 revenue of $7.9 billion.