It’s a deal that combines two of the biggest players in U.S. advertising to create the world’s largest media buying agency, but a term placed on the Federal Trade Commission’s approval of Omnicom Group Inc.’s $13.5 billion acquisition of IPG is turning the most heads as the FTC imposes restrictions around buys based on political or ideological viewpoints.
The FTC raised concerns that the consolidation could lead to anticompetitive coordination, where agencies might collectively steer advertisers away from certain media outlets based on their political content.
In a statement, FTC Bureau of Competition Director Daniel Guarnera commented, “Coordination among advertising agencies to suppress advertising spending on publications with disfavored political or ideological viewpoints threatens to distort not only competition between ad agencies, but also public discussion and debate. The FTC’s action today prevents unlawful coordination that targets specific political or ideological viewpoints while preserving individual advertisers’ ability to choose where their ads are placed. I thank the FTC staff for their thorough investigation of this merger.”
According to the FTC’s complaint, advertising agencies have previously engaged in informal coordination, including through industry groups, to discourage or limit ad spending on certain websites and apps. The consent order now bars Omnicom from making ad placement decisions that discriminate against media publishers for political or ideological reasons, unless directed by individual advertisers.
Without the restrictions, regulators argued, such coordination could reduce ad revenue for affected media outlets, limit their content offerings, and ultimately shrink the diversity of available information for consumers.
The FTC vote to issue the complaint and approve the consent order was 2-0-1, with Commissioner Mark R. Meador recused. The agreement will now undergo a 30-day public comment period before being finalized.
Under the terms of the deal revealed in December, Interpublic shareholders will receive 0.344 Omnicom shares per Interpublic share, giving Omnicom 60.6% ownership of the combined company and Interpublic 39.4%.
Omnicom CEO John Wren and CFO Phil Angelastro will retain their roles, while Interpublic CEO Philippe Krakowsky and COO Daryl Simm will become Co-Presidents and COOs of Omnicom. Krakowsky and two Interpublic board members will join Omnicom’s board.
