Publicis’s Levy Hands Torch to Deputy Sadoun After 30 Yearsby
Sadoun takes over as CEO of advertising company on June 1
Levy to be named chairman of Publicis’s board of directors
Publicis SA named Arthur Sadoun to succeed Chief Executive Officer Maurice Levy, an industry leader who built the French company into an advertising powerhouse in almost 30 years at the helm.
Sadoun, 45, will take over on June 1, according to a statement Thursday by Paris-based Publicis. He is currently CEO of Publicis Communications, the unit that houses ad agencies including Saatchi & Saatchi, Leo Burnett Worldwide and Bartle Bogle Hegarty. Levy, 74, will become chairman of the Publicis supervisory board, pending shareholder approval at a May 31 meeting.
Sadoun’s ascension, while expected, represents a monumental change for Publicis and for the industry, which has been dominated by Levy and his chief rival, WPP Plc founder and CEO Martin Sorrell, who have dueled for decades over matters large and small. Levy said in 2014 he would depart after the end of 2016, and Sadoun, his second in command, had been consolidating power.
“I’m sure he will take Publicis to new heights,” Levy said in an interview with Bloomberg Television. In five years, he said, Publicis “will probably be the only communication group capable of helping the client to transform themselves.”
Levy has led Publicis into the digital age and made the company the world’s third-biggest ad agency. During his time as CEO, Publicis grew from 3,000 employees to almost 80,000. The company’s market value has expanded by almost 100 times, to 14.6 billion euros ($15.6 billion).
“The announcement of the decision is reassuring as the succession planning created uncertainties that have been an overhang,” Tamsin Garrity, an analyst at Jefferies International Ltd. in London, wrote in a report. “The fact that Maurice Lévy, at the helm since 1987, is expected to stay is also supportive for the new CEO to smooth the transition and reinforce client relationships.”
Publicis rose 0.7 percent to 65.12 euros at 2:15 p.m. in Paris.
The process of finding a successor started in November and the company said it planned to finish by February. Sadoun joined Publicis Groupe in December 2006 as CEO of Publicis Conseil, before becoming CEO of Publicis France in 2009.
“The highly respected professional qualities of Arthur Sadoun, his unique understanding of clients and their needs, his accomplishments both during his time at Publicis Groupe and before, and his human qualities, all make him the prime candidate,” Elisabeth Badinter, the current supervisory board chairman, said in a statement.
While Publicis stepped up onto the world’s ad agency podium under Levy’s management, recent years have been marked by the failure of the merger between the French company and rival Omnicom Group Inc. in 2014, as well as contract losses in 2015, such as the ad space purchasing business with Procter & Gamble Co. and Coca-Cola Co. in the U.S.
Publicis, like all ad companies, also has faced the growing clout of digital companies such as Google Inc. and Facebook Inc., which are pulling revenue away from traditional media.
In the interview, Levy said that the acquisitions such as Digitas in 2007 have positioned the company to be “a key player in the intersection of information technology, advertising, digital and consulting.”
“Succession is never an easy task and this is the reason why I very much insisted that Maurice Lévy remain at our side to provide Arthur Sadoun with guidance in and recommendations for his difficult task,” said Badinter, the daughter of Publicis founder Marcel Bleustein-Blanchet.
Publicis also named Steve King, CEO of Publicis Media, to the company’s management board, which will be chaired by Sadoun.