Last checked at 
(Alliance News) - Ascential PLC on Monday said that it has agreed to sell its digital commerce business to Omnicom Group Inc and its product design business to funds advised by Apax Partners LLP.
According to the London-based business-to-business media and events company, the sales are for a combined enterprise value of GBP1.4 billion and brings it cash proceeds of GBP1.2 billion.
Once the transactions are complete, Ascential intends to distribute GBP850 million to its shareholders.
Following the announcement, Ascential shares rose 35% to 290.20 pence each in London on Monday morning.
Omnicom, a New York-based media company, will buy Ascential's digital commerce business for a total enterprise value of USD900 million.
Upon completion, Ascential Chief Executive Officer Duncan Painter will join Omnicom, taking up a role as CEO of Flywheel Digital, a new practice area within the business.
As previously announced, Philip Thomas will become Ascential's new CEO. He is currently CEO of Ascential Intelligence & Events.
Meanwhile, Wind UK Bidco 3 Ltd - a firm established by funds advised by Apax Partners - will buy Ascential's product design business for an enterprise value of up to GBP700 million. After closing adjustments, proceeds to Ascential are expected to be GBP572 million.
Both transactions are expected to complete by the end of the first quarter of next year.
Once completed, Ascential intends to return GBP850 million to shareholders by way of a special dividend. The amount, timing, and form of this return remains to be decided by the board, however.
"The board firmly believes that the proposed sales of Digital Commerce and WGSN represent excellent value for shareholders, including the return of a significant portion of the combined proceeds," said Chair Scott Forbes.
Forbes added: "Furthermore, these actions are compelling in that they will enable us to achieve the objectives of the strategic review, addressing the distinct investment propositions of Ascential's three businesses, while also better positioning each business to achieve their growth ambitions."
Separately on Monday, Ascential also announced that the board of Hudson MX has initiated a sale of the business. Omnicom has confirmed its participation in the sale process.
Hudson MX is a US-provider of software-as-a-service media buying and media accounting solutions, in which Ascential is a 36.5% shareholder.
In February, Hudson completed a financing round led by MT II Holdings LP. Ascential entered arrangements that provided it with a path to a majority stake in Hudson in the future.
This included a put option granted to MT II, which if exercised in full, would result in Ascential's holding in Hudson increasing to 79%.
Ascential has now entered new arrangements with MT II in order to ensure that MT II will receive at least the same consideration for its stake in Hudson when the business is sold.
On agreement of these new arrangements, MT II and Ascential have agreed to the initiation of the sale process for Hudson. The value of the consideration due to MT II if the existing put option and the call option are exercised is GBP66 million.
In the event that the sale process for Hudson does not complete by April of next year, MT II's and Ascential's existing put and call options will be automatically exercised and the full amount would be payable to MT II by Ascential.
This means that Ascential needs to retain GBP66 million of the proceeds from the sale of its digital commerce and product design businesses, pending the conclusion of the sale process for Hudson, which is expected in the first half of 2024.
By Holly Beveridge, Alliance News reporter
Comments and questions to newsroom@alliancenews.com
Copyright 2023 Alliance News Ltd. All Rights Reserved.
