Omnicom offers bondholders cash, new debt in preparation for Interpublic merger
Omnicom has launched exchange offers and consent solicitations for $2.95 billion of Interpublic’s bonds, a key step in restructuring debt ahead of their pending merger.
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Ahead of its pending acquisition of Interpublic Group (IPG), Omnicom Group Inc. has launched a pair of exchange offers and consent solicitations targeting holders of outstanding Interpublic notes. The move, announced Monday, offers bondholders a choice: swap existing IPG debt for new Omnicom-issued notes at par and receive additional cash incentives, or retain their current holdings under revised terms. While tactical on its face, the offer serves as a prelude to the merger’s completion, should regulatory and shareholder approvals fall into place.
Under the deal, Omnicom is offering exchangeable options for approximately $2.95 billion in IPG’s existing bond series, ranging from notes maturing in 2028 to those due in 2048.
The proposal includes:
Exchange Offers: Eligible bondholders can swap their IPG notes for new, identically structured senior notes issued by Omnicom.
Consent Solicitations: Bondholders are also asked to approve amendments eliminating certain covenants and default provisions embedded in the IPG notes.
Bondholders who tender their notes early—by 5 p.m. EDT on August 22—stand to receive $1,000 in new Omnicom notes for each $1,000 of IPG notes surrendered, plus a cash "consent payment" and an "early tender payment," both amounting to $1 each. This brings the total consideration to $1,002 for early participants.
For those participating between August 22 and the September 9 expiration, the offer is slightly less generous: $970 of new notes, assuming requisite consents are secured.
Why This Matters
This financial orchestration is tightly linked to Omnicom’s proposed takeover of Interpublic, announced in December 2024, in which IPG shareholders would receive 0.344 shares of Omnicom stock per share owned.
Regulators have cleared significant hurdles, including FTC approval in June - subject to a consent order barring politically motivated ad-placement decisions - and Australia's competition clearance in July.
For bondholders, tendering under favorable terms ensures continued participation in the combined entity's debt framework, rather than holding potentially disadvantaged legacy bonds. It also reflects Omnicom's effort to align financial structures ahead of closing the merger.
What Lies Ahead
The exchange and consent mechanisms are conditional on first achieving "majority noteholder consents" across each bond series, as well as consummating the merger - currently expected in the second half of 2025, pending final regulatory clearances and customary closing conditions.
This proactive financial step underscores Omnicom’s intention to smooth the path toward integration with Interpublic, offering bondholders short-term incentives while consolidating debt into its own structure. As the broader merger advances, the offer will serve as a bellwether for investor appetite and confidence in the combined marketing and advertising powerhouse.
