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WPP’s slew of South African agency acquisitions shows no signs of slowing down. The massive holding company on Wednesday announced that it had acquired mobile marketing specialist Yonder Media through its Group M division.
Yonder Media’s unaudited consolidated revenues for the year ended 28 February 2015 were approximately R20-million, with gross assets at the same date of approximately R18-million. Being a media-focused agency though, its billings are much higher at around R100-million. While Yonder Media CEO Rick Joubert refused to comment on the value of the deal, Memeburn sources and calculations put it in the R45-million to R50-million range.
While not an outright acquisition, Group M does now own a majority stake in Yonder Media. According to the deal terms, Yonder Media will continue operating as an independent brand and also lend speciality services to the GroupM agencies – Mindshare, MEC Group (MEC and NotaBene), MediaCom and Maxus. Together those companies, and others within its stable mean that it feels comfortable calling itself “the world’s largest advertising media company in terms of billings”.
According to Joubert, the deal has been in the works “for a good eight months or so”. He also said that there had been other players interested in the agency in the past.
“GroupM is the leading media investment group in South Africa; we grow this position by continuously evolving to meet clients’ needs, and today those needs are digital,” said Michelle Meyjes, Chief Executive Officer, GroupM, South Africa. “Mobile and digital usage are in rapid growth mode across South Africa. With Yonder Media, we will establish a mobile/social hub of excellence to support our client base and agencies and lend our scale and resources to help Yonder continue its best-in-class independent services.”
Having been in operation for more than 10 years now, Yonder is based outside of South Africa’s traditional marketing hubs in Centurion, near Pretoria. It offers services across the mobile, social and digital space. Joubert, who is on occasion seen on the speaking circuit, hails from Vodacom where he worked with well-known digital practitioner and former Mxit CPO Vincent Maher.
Joubert told Memeburn that the entire Yonder Media management team had committed to staying on indefinitely and that the agency would continue supporting its current crop of clients.
“We’re absolutely determined to continue to support all our other clients, even our agency clients,” he said. “There’s always a danger with deals like these that smaller, independent agencies get swallowed up by the beast, but the way this deal’s structured means we’ll be able to keep doing great work for our existing clients.”
The Yonder Media CEO added that the deal could potentially do a lot for Yonder, including giving it access to the massive amounts of IP in the WPP network, as well as giving it chances to tap into that network’s client base.
Among the services offered by Yonder are mobile and social media strategy, application development, media planning, buying and management, as well as related services like mobile airtime rewards, mobile coupon management and mobile reply path in traditional media executions.
“Our Yonder Media team has distinguished its excellence in digital and mobile advertising by leading the market and garnering international recognition with awards at Mobile Marketing Association’s Global Smartie Awards for the past three years running,” says Joubert. “WPP’s acquisition of a majority stake in our company is further validation, and we are thrilled that we’ve been able to maintain our independence whilst working with our new partners to accelerate the growth of mobile and social media advertising in South Africa and the African continent”.
In South Africa, WPP (including associates) generates revenues of around US$500 million and employs around 26 000 people. Across the continent of Africa, the Group (including associates) collectively generates revenues of almost US$700-million and employs more than 28 000 people.
While Joubert told us that the company hadn’t thought about how it planned to celebrate the acquisition, he did confirm that it would add an “extra bit of spice to the end of year office party”.