WPP Scangroup is letting go of one of its business arms with a US company waiting in the wings to acquire its research business on the continent.
The Nairobi Securities Exchange (NSE) listed firm announced on July 31 that a US-based private equity firm is set to buy its research business.
A year to the date, Scangroup had announced the acquisition of Kantar TNS.
Scangroup, the marketing and communications company that adopts a multi-agency business model, said that Bain Capital has triggered certain “drag and tag” rights in respect of Kantar, its data, research, consulting and analysis business.
One of the co-founders of Bain Capital is Mitt Romney, a former presidential candidate in the US.
“Shareholders of WPP Scangroup Plc and the investing public are advised that WPP Plc, Scangroup’s majority shareholder has entered into an agreement to sell 60% of its shareholding in Kantar,” said company secretary Reuben Mwangi.
The NSE listed company’s stake in Kantar includes an 80% shareholding in Kantar TNS as well as a 100% shareholding in Kantar Millward Brown.
Kimani added, “The transaction may result in material change in the Company’s (WPP Scangroup) control of Kantar’s business in Africa.
Completion of the deal relies on pending approvals and concluding discussions with shareholders, Scangroup said while advising its current shareholders to be cautious in dealing with its shares on the market.
Just last year, WPP Scangroup announced the completion of its takeover of Kantar TNS in what was a bid to align the two market research businesses, for enhanced service for clients and increased operational efficiency.
Kantar TNS operates in Nigeria and Kenya, which are primary markets for WPP Scangroup, and other countries including Senegal, Cameroon, Cote d’Ivoire and Ghana.
The research arm was recently responsible for collaborating with African Business Magazine in order to rank Africa’s Best Brands.
It’s sale to Bain Capital will add to the variety of investments owned by the Boston based private equity firm which has also invested in companies such as Domino’s Pizza and Burger King among many others.