U.S. Markets open in 2 hrs 2 mins

StockBeat: Publicis, IWG Sparkle on Deal News

By Geoffrey Smith

Investing.com -- Earnings season may be ramping up but it’s M&A activity that's grabbing most attention in Europe’s stock markets this morning.

The biggest eye-catcher is French advertising group Publicis (PA:PUBP), which rose over 4% at the opening after announcing it had agreed to buy the marketing data unit of Alliance Data Systems (NYSE:ADS) for some $4.4 billion. It’s given up some of those gains since, but the move — Publicis’ biggest ever acquisition — is exactly the type of investment it needs to get ahead in digital marketing and reduce its dependence on an old-media ad business that is being squeezed hard by the likes of Facebook (NASDAQ:FB) and Google (NASDAQ:GOOGL).

Publicis was leading the CAC 40, which was broadly flat. The benchmark Euro Stoxx 600 was also essentially unchanged at 387.40, despite more hints over the weekend that China and the U.S. are approaching agreement on their various trade disputes. The FTSE 100 was down 0.2% and Germany’s Dax was down 0.1%, not helped by a drop in Daimler (DE:DAIGn) shares after a report alleging further emissions-related misdeeds on Sunday.

Meanwhile in London, IWG (LON:IWG), the office space company formerly known as Regus, rose as much as 20% in early trading after agreeing to sell its Japanese business to Tokyo-based TKP for 320 million pounds ($420 milion), a sum that’s around 3.4 times the business’s annual revenue.

Under a franchise agreement due to start next month, IWG will also continue to get an unspecified fee from TKP, which will act as operator for all of IWG’s flexible workspaces in Japan.

Finally, French media group Vivendi (PA:VIV) was up 0.5% after reporting further progress in preparing the sale of a stake in Universal Media Group. Vivendi said it would soon complete the process of choosing banks to manage the sale of up to half of the unit, which is worth $30 billion by some estimates. UMG’s revenue rose 19% in constant-currency terms in the first quarter, accounting for nearly all of a 5.7% increase in group revenue.

Related Articles

Check Point Software Earnings, Revenue Beat in Q1

Nestle and Unilever Raise Prices Without Stunting Growth

Stocks erase week's gains after weak manufacturing surveys