Last summer, two enormous advertising companies, Omnicom and Publicis, announced that they'd be merging to form the world's most enormous advertising company. Yesterday, they announced the deal is off. Why? Because these companies are essentially kindergarteners.
You can read all the stories today listing all of the obligatory reasons about why the huge merger failed, according to those involved— difficulty in merging corporate cultures, vague complications with tax issues and management clashes. But all it really comes down to, everyone seems to agree, is the fact that these two multibillion dollar global corporations could not agree who would win this thing. You see, "technically one company has to acquire the other, for accounting reasons." And they could not agree on who would be on which side, because, of course, who wants to be the acquired? Only losers! Our guys must be the top guys! Dealbook sums it up:
One significant unresolved issue was which company would be acquiring the other one. After much persuasion, Publicis was prepared to allow Omnicom to be the acquirer, according to people briefed on the matter. But Publicis then balked at the notion that Omnicom's management would retain control of both the chief executive and chief financial officer roles. Omnicom was pressing to have its finance chief, Randall J. Weisenburger, keep his role.
We have to be the #1 acquirer! If we are #2 then our guy must be #1! I want to be the first name on the door! No, I do! If my guy can't win then I don't care, I'm going home!
A thirty five billion dollar global corporation in action, ladies and gentlemen.
[Photo of two small children: AP]