NEWS15 April 2019

Publicis Groupe to buy Epsilon

Data analytics Europe M&A Media News North America Technology

FRANCE – Advertising company Publicis Groupe has agreed to acquire Alliance Data Systems Corporation’s Epsilon business in a deal worth $4.40bn.

arthur sadoun

The acquisition, which is the advertising group’s biggest to date, will boost its technology and data offer and its ability to deliver personalised multi-channel marketing campaigns. Epsilon’s software is used to on-board clients’ first-party data and build customer profiles based on data and AI for segmentation and analytics.

Epsilon employs around 9,000 staff, including 3,700 data scientists. The deal will also bring Publicis better insights for creative development, connect Epsilon’s data sets with Publicis Media data, and allow the advertising group to offer clients deep proprietary customer insights.

Alliance Data announced in November that it had begun exploring strategic options for Epsilon.

Arthur Sadoun, chairman and chief executive of Publicis Groupe (pictured), said: “With the acquisition of Epsilon, Publicis Groupe is bringing the necessary technology, expertise and the talent to complement our offer in creativity, media and business transformation, and help our clients leapfrog their competition and grow profitably.”

Sadoun added that the deal will offer clients more of an “end-to-end solution” and described the deal as a “one-time opportunity with very compelling financial terms”.

The net purchase price is $3.95bn after tax step-up (total cash consideration of $4.40bn). Publicis will also build a ‘strategic partnership’ with Alliance Data’s remaining business.

Bryan Kennedy, chief executive of Epsilon, said: “During extensive discussions with the Publicis leadership team during the recent review process, we found powerful common ground, including shared values and a strong vision for the future of data-driven, digital-first marketing.”

Edward Heffernan, president and chief executive, Alliance Data Systems, said the deal represents “a trifecta win” for the three businesses. He said: “With this transaction, we have found what we believe to be the right home for Epsilon’s technology, data assets and associates. Furthermore, the unique relationships that have been cultivated between Epsilon and our other Alliance Data businesses will remain intact, and we look forward to working with Publicis Groupe to develop an even broader relationship promoting mutual and sustainable growth going forward.”