Publicis eyes $5bn Epsilon as data gold rush continues

The data-driven marketing industry is set for yet another mega deal, following confirmation that Publicis is considering a bid for Epsilon – which has been valued at a whopping $5bn (£3.8bn) – as the stampede for data businesses continues.
In the past 12 months alone, Adobe acquired Marketo for $4.75bn (£3.5bn), Dun & Bradstreet sold to a consortium of investment firms for $6.9bn (£5.4bn), IPG swooped on Acxiom’s marketing business for $2.3bn (£1.7bn), while TransUnion paid $1.4bn (£1bn) for Callcredit Information Group.
Alliance Data Systems bought Epsilon in 2004 for $300m and reports first emerged late last year that it was considering selling the division – which also includes digital marketing specialist Conversant.
Epsilon’s international expansion is well under way in the EMEA and APAC regions, with offices in Australia, China, India, Japan, Singapore, the UK, Ireland, Germany, France and Spain. Its clients include Dell, Google, Jaguar Land Rover, Kellogg and Johnson & Johnson.
Publicis reportedly entered a bid for the company late last week, alongside a joint offer from Goldman Sachs and global private equity firm Advent International, which also invests in Williams Lea Tag Group.
In a statement, Publicis said it felt “an obligation to study any possibility to strengthen its position” and bring “an enhanced service to the group’s clients”.
However, Publicis also confirmed it was far from a “done deal”, adding that there had been other instances in which it “studied potential targets but chose not to make any offer as the contemplated transactions did not meet the necessary criteria”.
The agency’s main data offering is Publicis Spine, which launched in October 2017. The platform comprises three core components: data matching from first, second and third party sources; PeopleCloud, a cloud-based platform that uses data to identify sources of client growth at the individual level; and a single data and analytics team using 3,500 engineers, scientists and tech leaders across Publicis Group that will help clients turn data into business insight.
According to an IDC study, the data analytics market is set for a major surge over the next five years as more and more companies embrace digital transformation, with revenues for big data and business analytics solutions predicted to reach $260bn (£200bn) by 2022, with a compound annual growth rate of 11.9%.