WPP stock gains over 3% after reports of interest from potential bidders
Investing.com -- Shares of WPP Plc (LON:WPP), the embattled British advertising and communications conglomerate, climbed over 3% on Monday after reports surfaced that the company has attracted interest from both strategic and financial buyers.
The takeover whispers center around French peer Havas N.V. and private-equity giants Apollo Global Management and KKR & Co., as reported first by The Times.
While it remains unclear whether any formal bid has been made, sources suggest potential suitors might explore full acquisition, large-stake purchases, or selective buyouts of individual business units.
The surge in WPP’s share price is especially striking given the company’s dire recent performance. Year-to-date, its stock has tumbled by more than 60%, bringing the company’s market valuation down to roughly £3 billion.
Under the leadership of its new CEO, Cindy Rose, WPP is currently executing a sweeping restructuring, refocusing its efforts on data-driven and AI-led operations.
This comes after WPP issued a profit warning, following a 5.9% decline in like-for-like net revenue, further fuelling speculation that the turnaround could be accelerated via a takeover.
The potential buyer interest underscores just how distressed WPP has become. Once a towering titan of the ad world, the company now trades near its lowest levels in decades, prompting some hedge funds to take large short positions.
Yet, despite the renewed enthusiasm, significant uncertainty remains. No formal offer has been publicly confirmed, and at least one of the reported suitors, Apollo, has reportedly denied being in active discussions.
Analysts caution that even if a deal does emerge, execution risks are material: any acquirer would need to navigate WPP’s high leverage, complex global operations, and the challenge of integrating or turning around underperforming business units.
From a strategic perspective, a takeover could unlock latent value. WPP has already demonstrated this in recent years, most notably when it sold its majority stake in FGS Global to KKR for US$1.7 billion, a move that helped reduce its leverage significantly.
Meanwhile, major investors are watching closely: institutional shareholding has shifted recently, with RWC Asset Management now controlling over 5.2% of voting rights.
