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WPP PLC on Tuesday said it has sold its majority stake in strategic communications consultancy FGS Global Ltd to Kite Bidco Inc, an acquisition vehicle of funds managed or advised by private equity firm Kohlberg Kravis Roberts & Co LP. The London-based advertising and public relations company said the sale of its 50% stake was at an enterprise value of around $1.7 billion, with $775 million payable in cash. WPP will receive $707 million after tax. WPP said this is ‘an attractive valuation multiple to the 2023 [earnings before interest, tax, depreciation and amortisation]’. The total cash proceeds of $767 million, including a £47 million inflow from the repayment of a loan made by WPP to FGS, will be used to reduced WPP debt. WPP said the deal has no impact on its current year or medium term guidance and is expected to be ‘broadly earnings neutral’ in 2025. Shares in WPP were up 0.7% to 873.40 pence in London on Tuesday morning for a £9.43 billion market capitalisation. The wider FTSE 100 index was up 0.6%. Copyright 2024 Alliance News Ltd. All Rights Reserved.
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