Ogilvy South Africa and Gloo, a leading digital design agency, are in talks. According to a number of reliable sources, who spoke to Ventureburn on condition of anonymity, the talks are around acquisition but CEO and founder Pete Case has rubbished such claims.
No ad to show here.
Since being founded in 2005, Gloo has made a serious name for itself, winning multiple awards and drawing in big name clients including FNB, Microsoft, the Discovery Channel and British Airways. While the company is part-owned by Kagiso Media, it remains one of the few well-known digital agencies in the country not to have sold a stake to a global advertising mega-corp like Publicis or WPP — the group which owns Ogilvy.
It’s unclear precisely what the terms of any possible deal would be, but it seems likely if anyone’s shares in Gloo were to be offloaded, it would be Kagiso’s. When we spoke to former Kagiso financial director Mervyn van Zyl, he said that selling its stake in the agency “definitely was an option” during his time at the media outfit.
When we spoke to Graham Talbot, technical whip and shareholder at Gloo, he didn’t deny that a deal was in the works. “There’s always something going on,” he said.
Founder Pete Case meanwhile fervently denied that any deal was in the works, saying that Gloo had recently joined Ogilvy in a joined venture.
“One of the problems with being a company like ours is that we’re in and out of lots of agencies,” something which he believes helps fuel acquisition rumours.
“There are certainly lots of acquisition talks in the industry right now, but nothing from our side,” he said.
If a deal were to go through, it would make Gloo just the latest in a series of South African companies to have been brought in under the wider WPP umbrella in the past couple of years. Most recently, it acquired Quirk in a deal believed to be worth around R400-million.
In 2013 meanwhile, it bought controlling stakes in digital communications agency Cerebra and full services digital agency NATIVE, with the latter subsequently being rebranded as NATIVE VML.
Prior to that, it had acquired stakes in Acceleration and in 2007 it bought out digital agency Aqua Online, which at that stage was the country’s largest independent full-service digital agency.
In South Africa, WPP (including associates) generates revenues of around US$500-million and employs around 26 000 people. Across the continent of Africa, the Group (including associates) collectively generates revenues of over US$600-million and employs over 27 000 people.
The massive holding company’s South African buying spree is just the tip of the iceberg though. In Africa, it owns agencies in a number of markets, including Kenya, Nigeria, Egypt and Ghana.
On the international stage, WPP’s spending spree has been even more astonishing. Since 2007, it’s bought outright or controlling stakes in over 122 companies around the world.
