At the WPP annual meeting in June 2017, WPP Chairman Roberto Quarta was asked to defend CEO Martin Sorrell's compensation package for $ 62.2 million. "Sir Martin Sorrell has built this business out of nothing," said Quarta. "He is absolutely committed to this business, I do not think Martin Martin will be paid to WPP, he's been here for 30 years and hopefully we'll keep him here for many years."
Less than a year later, Sorrell has signed back from the largest agency in the world as part of an investigation into the company's misconduct and worst performance in a decade. But he leaves an indelible legacy in the advertising business.
Below is a selective look at the history of the empire that he built out of shopping carts.
Sorrell invests with the intention of the British company Wire & Plastic Products of building a promotional product under the brand. One year later he becomes CEO.
WPP (Revenue 1986: $ 38 million) turns the once-upscale industry on its head with its very first hostile takeover and buys J. Walter Thompson (1986: $ 641 million). JWT rejects Sorrell's original $ 435 million offer and sues the takeover. Sorrell sweetens the offer to $ 566 million and wins JWT despite three large JWT customers – Ford Motor Co., Goodyear Tire & Rubber and Eastman Kodak. Goodyear leaves; Ford got trillions of $ 90 million back then, but today he remains an important WPP customer.
The cover page of Ad Age on June 15, 1987 screams after the takeover bid by Walter Thompson of WPP. Credit: Ad-age
Ogilvy & Mather is hit by WPP in another $ 864 million unsolicited bid that has earned Sorrell the nickname of "Madison Avenue Ogress." A tighter attempt came from O & M founder David Ogilvy, who famously referred to Sorrell as "a vile little crap". The two later came to relax, former ad-age editor Fred Danzig wrote: "Mr. Sorrell asked Mr. Ogilvy for dinner, always the gentleman, realizing that he had been talking hard about someone he had never met Mr. Ogilvy sat down with Mr. Sorrell and got away with a new friend. "
The high price of O & M results in WPP borrowing heavily, while the business and agency business slips into recession. In 1990, a profit warning causes equities to fall 66 percent in just four days. The company's stock drops 96 percent from a high of 1989 to its low of 1992 ($ 2.50). The external accountant in 1991 doubts the ability of WPP to ensure its continued existence. WPP restructured its $ 1 billion debt in 1992
31. December 1999
Martin Sorrell is knighted. In a rather strange interview with valleygirl.tv in 2012, he says that after the queen has put the sword on his shoulders, "She said to me, 'Are you still involved in the business?'" Somewhat dumbfounded Mr Sorrell replied, "Well, Ma'am, I am – unless you know something I do not know."
In a $ 4.7 billion deal, WPP Young buys & Rubicam. Even before Sorrell has completed the deal, WPP's shares stumble over speculation that he will overpay. Y & R was hardly the industry's hottest agency at the time, but the deal also includes other esteemed properties such as Wunderman, one of the largest digital games in the agency business. The press release announcing the sale states that "the WPP Group is becoming the industry leader with Y & R". Nevertheless, the Omnicom group will remain at market capitalization by billions in the future.
WPP acquires the Cordiant Communications Group. The agreement includes Bates, Fitch, HealthWorld and 141 Worldwide. The holding company establishes GroupM to oversee its media agencies.
Hamish McLehnan and Martin Sorrell of Young and Rubicam in November 2003. Credit: Rob Homer / Fairfax Media on Getty Images
Madison Avenue's last major independent, Gray Global Group, drops for $ 1.8 billion in WPP in cash and shares, Gray Chairman-CEO Ed Meyer sells his WPP share the day after the purchase was completed. Gray's Procter & Gamble business will make P & G a top 10 WPP customer. The combination creates a $ 9.4 billion holding in WPP, but is still behind Omnicom's $ 9.7 billion in revenue.
WPP Spends $ 649 Million on the Acquisition of 24/7 Real Media, a Digital Enterprise with a Long History. Merrill Lynch entered the stock exchange around the clock in 1998, earning $ 70 a share; Stocks rose to $ 348. Merrill analyst Henry Blodget even recommended the stock in 2000, as he privately described in internal emails as "shit". After the bursting of the net bubble, shares fell to 45 cents in 2001. 24/7 lost money in 12 of 13 years to 2006, but WPP sees opportunities to expand its digital arsenal around the clock. WPPs brokers on this deal? Merrill Lynch
WPP surpasses Omnicom as the largest agency firm. WPP bounces back to Omnicom through the contribution of Taylor Nelson Sofres, a UK market research firm that purchases WPP in October 2008. Taylor Nelson Sofres becomes part of the WPP market research firm Kantar.
WPP buys AKQA Holdings, a US-based digital network, with an enterprise value of $ 540 million. At the WPP annual meeting, 60 percent of shareholders protest against Sorrell's salary.
In July, Publicis Groupe and Omnicom propose a merger that would overthrow WPP from its hard-won stance. "It's messy and it gives us a lot of options," says Sorrell about the proposed marriage, saying that it had no benefits for employees or its competitors customers. The merger plan will be resolved in May 2014.
Sorrell's shareholder rejection of Sorrell's salary has become a constant at WPP's annual meetings, and a complaint is filed in June over his $ 62.2 million payment already made by 91, 1 million last year was cut. WPP's sales in 2017: $ 19.7 billion.
On March 1, WPP suffers the worst stock market crash since 1999, after Sorrell predicted a year of no growth, blaming its customers for packaged goods. In a statement issued on April 3, the Board states that it has "appointed an independent lawyer to conduct an investigation in response to a charge of personal misconduct against WPP's Chief Executive Officer Sir Martin Sorrell." Investigations are still important for WPP. "Sorrell says in his own statement that he rejects the allegations" unconditionally ".
Eleven days later, Sorrell resigns as CEO, ending a 33-year career with the largest agency in the world.