Law360 quotes Ashwin Pillay on KKR buying a majority stake in public relations firm FGS Global
Investment firm KKR has agreed to buy a majority stake in FGS Global, in an all-cash deal that values the global public relations firm at $1.7 billion.
KKR said that Kite Bidco Inc., an entity controlled by investment funds it manages or advises, plans to buy an approximate further 50 per cent of FGS from UK advertising company WPP PLC for $775 million, or $707 million after tax. The US asset manager bought a minority stake of 29 per cent in FGS in April 2023 that valued the British company at the time at $1.4 billion.
Philipp Freise, a partner and co-head of European private equity at KKR, said in a statement that the proposed deal will allow the private equity group to increase its stake in the growing management consulting service industry.
Ashwin Pillay, Senior Associate in our Corporate team, comments on the deal in an article for Law360. He explains that the wider communications sector is of increasing interest to strategic investors because of its "resilient growth," compared with lower deal volumes in other industries.
If the sector continues to grow and FGS can effectively utilize the benefits of industry consolidation and access to KKR's network and resources, KKR will be optimistic about achieving a decent profit on exit.
Read the full article in Law360 here (subscription required).
