Events giant Ascential is to divest two of its technology businesses for a combined £1.4 billion.
Listed Ascential has entered into agreements, subject to shareholder approval, to sell its digital commerce business Digital Commerce to Omnicom Group Inc and its product design business WGSN to Wind UK Bidco 3 Limited, a newly-formed company established by funds advised by Apax Partners LLP.
Following completion of the transactions, Ascential intends to distribute approximately £850 million to its shareholders.
The managed separation aims to create an optimal structure for three distinct businesses, with Ascential continuing as an independent company focused on events.
New York-based Omnicom will acquire Digital Commerce for a total enterprise value of approximately £741 million, with WGSN sold to Wind UK Bidco 3 for a total enterprise value of up to £700m.
For the 12-month period ended 30th June 2023, Digital Commerce and WGSN, in aggregate, represented 63% and 46% of the Ascential Group’s revenues and adjusted EBITDA, respectively.
The events business delivered revenues of £213m and adjusted EBITDA of £85m.
Duncan Painter, currently CEO of Ascential, will join Omnicom and take on a new role as CEO of Flywheel Digital, a newly created practice area of Omnicom which will operate the Digital Commerce business. He will step down from the board of Ascential.
Philip Thomas, currently CEO of Ascential Intelligence and events, will replace him at the helm of Ascential and join the board.
Independent non-executive directors Joanne Harris and Charles Song will step down from the board of Ascential.
“The board firmly believes that the proposed sales of Digital Commerce and WGSN represent excellent value for shareholders, including the return of a significant portion of the combined proceeds,” said Scott Forbes, chairman, Ascential plc.
“Furthermore, these actions are compelling in that they will enable us to achieve the objectives of the strategic review, addressing the distinct investment propositions of Ascential’s three businesses, while also better positioning each business to achieve their growth ambitions.”
Painter added: “We are delighted that we have found excellent owners for both Digital Commerce and WGSN that will allow each business to flourish and take the next steps to pursue their own individual ambitions.
“Omnicom’s and Digital Commerce’s complementary technology and data platforms, together with their strong client relationships will be instrumental in accelerating the realisation of Digital Commerce’s strategy, and WGSN is also well set for its next chapter of growth under new ownership.
“Ascential’s continuing business with its world-leading Events brands remains well-positioned to succeed as a high quality, independent UK-listed business.”