Omnicom-IPG deal: Congress probes ad giants over links to GARM
Both companies have been instructed to preserve all relevant documents and communications with the WFA and GARM and to provide them to a Congressional committee for review.
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Global ad holding company Omnicom announced its acquisition of Interpublic Group (IPG) on December 9 and just ten days later, the agreement is now under Congressional scrutiny from Representative Jim Jordan, a Republican from Ohio, who has launched a probe into the two advertising giants' connections to organizations he deems hostile to conservative values.
Both ad firms are US based and the advertising world was stirred and shaken with the news of Omnicom’s acquisition of IPG, a merger that can potentially metamorphose the global ad industry. The blockbuster deal values the combined entity at approximately $30 billion, with $65 billion in global media billings.
On Wednesday, The New York Post reported that Jordan, who chairs the House Judiciary Committee, had sent letters to the CEOs of Omnicom and IPG, both of which were founding members of the World Federation of Advertisers (WFA) and the recently dissolved Global Alliance for Responsible Media (GARM). The inquiry forms part of a broader antitrust investigation led by Jordan’s committee.
In the letters, Jordan instructed both companies to preserve all relevant documents and communications with the WFA and GARM and to provide them to the committee for review.
The committee is scrutinizing whether the proposed merger between Omnicom and Interpublic Group could stifle competition, particularly in relation to conservative media outlets.
According to reports, the Global Alliance for Responsible Media (GARM) has accused right-wing platforms of disseminating what it called “harmful content,” alleging that these outlets were systematically denied advertising revenue. GARM allegedly lobbied over 40 major companies, including Adidas, American Express, Bayer, BP, Carhartt, Chanel, CVS, and General Motors, to withdraw their ad spending from conservative-leaning media.
The organization is said to have specifically urged advertisers to divert their dollars away from right-wing news platforms, including The New York Post and Fox News, both of which are owned by News Corp.
The committee has requested responses to its letters by January 7.
