WPP row with former boss Sir Martin Sorrell heats up as company claims it has been considering a move for MediaMonks ‘since November’
FTSE ad giant WPP today claimed it has been considering a takeover of Dutch agency MediaMonks since November 2017, as it described a rival bid from former boss Sir Martin Sorrell as “unlawful”.
A letter sent by WPP's lawyers to Sorrell suggested the competing bid from his new marketing venture S4 was a "diversion of a maturing business opportunity for WPP".
The company says Sorrell was "heavily engaged" in talks with the Dutch firm's management while he was chief exec of WPP, and even attended a meeting with them in the Netherlands.
WPP's letter also warned Sorrell he risked losing £20m in shares if S4 pursued its interest in MediaMonks.
Though Sorrell did not sign a non-compete agreement when he left the company, he agreed to other confidentiality undertakings, which WPP says he risks breaching through his bid for the agency.
Sky News today reported that Lewis Silkin, the law firm representing Sorrell, is disputing the claims and has asked WPP to provide evidence of the alleged meetings and internal discussions regarding MediaMonks.
The news outlet said a source close to Sorrell explained he was "connected" to a potential bid through private equity firm Inflexion.
A spokesperson for Sorrell shrugged off the claims.
"This appears to be an attempt to muddy the waters," they said. "Sir Martin, his lawyers, his senior legal counsel and his fellow investors are very relaxed."
This latest development escalates the row between advertising behemoth WPP and the man who built it into the world's biggest advertising firm over 33 years.
Speaking at Cannes a few weeks ago, Sorrell said the "peanut" sized S4 did not intend to compete directly with WPP.
"Although it does occur to me that some people have peanut allergies," he added.
Reports this week claimed Sorrell was raising a £1bn war chest to fund acquisitions to grow S4, which suggests the new business may be a bigger threat to WPP than originally thought.
A spokesperson for WPP declined to comment.