* Publicis hit by 1.44 bln euro charge, N.America weakness
* Ad group paid too high a price for Sapient -source
* Company sticks to margin targets (Adds details, source comments)
By Mathieu Rosemain and Gwénaëlle Barzic
PARIS, Feb 9 (Reuters) - Publicis paid a heftyprice for its acquisition of ad firm Sapient on Thursday, with a1.4 billion-euro writedown on its Publicis.Sapient arm pushingthe French group to an annual loss and underlining the challengefor its new chief executive.
The French advertising group paid a 44 percent premium forSapient, a price that puzzled many investors and analysts whenthe $3.7 billion deal was struck two years ago after the failedattempt to merge Publicis with rival Omnicom in 2014.
Thursday's total writedown of 1.44 billion euros casts ashadow over the legacy of departing CEO Maurice Levy, as theacquisition was meant to move Publicis closer to competing withcompanies like Accenture in digital consulting.
This was in stark contrast to larger competitor WPP,which invested heavily in real-time programmatic media buyingand is due to report full-year earnings on March 3.
Publicis, the world's third largest advertising company, ispreparing for change at the top when Levy hands over in June to45-year-old Arthur Sadoun who oversees its creative agencies,including Saatchi & Saatchi and Leo Burnett.
And former Sapient boss Alan Herrick, once seen as apotential candidate to succeed 74-year-old Levy, does not appearin a new organisational chart from Jan. 26 which follows areshuffle of the top management team, a source told Reuters.
Publicis is trying to foster greater cooperation between itsagencies and win back big clients lost when several majorcontracts were renewed in 2015, but still reported weaker thanexpected sales in the last three months of 2016.
Shares in the group were as much as 5 percent lower andbriefly the worst performer of the Euro Stoxx 600 index, afterPublicis announced a net loss of 527 million euros.
It said a weaker performance from Razorfish, the digitalmarketing agency it bought from Microsoft in 2009, was also responsible for the impairment charge in its digital division.
Razorfish, where revenues fell 15 percent in 2016, has beenhit by management changes and the death of global chiefexecutive Tom Adamski in October 2015.
U.S. SALES HIT
Fourth-quarter revenue for the group was 2.67 billion euros,an underlying drop of 2.5 percent compared with the same perioda year ago, as market conditions in North America, Publicis'number largest region for sales, worsened over the three months.
A Reuters poll had forecast an underlying sales drop of 0.63percent, but Publicis said political uncertainty around the U.S.election in November had hit advertising for products such assoft drinks and processed foods.
Levy said that the challenges were likely to continue toweigh on sales in the first half of 2017, although Publicisshould see underlying sales growth return to the market averagein the second half of the year.
Omnicom, the world's second-biggest advertising group, alsofaced a slowing market in North America, with 0.6 percentunderlying sales growth for the region in the fourth quarter.
Despite the setback, Levy stuck to targets set out under thegroup's strategic plan for 2018, including a yearly operatingmargin of 17.3 to 19.3 percent. Last year, Publicis' operatingmargin stood at 15.6 percent.
"It's clear that it's a little bit more difficult... butit's not unachievable," Levy said of the 2018 targets.
Analyst Charles Bedouelle of Exane BNP Paribas said this wasnot the market view, however, citing the average forecast inoperating margin for 2018 of about 16.5 percent. ($1 = 0.9357 euros) (Editing by Bernard Orr/Keith Weir/Alexander Smith)
WPP (WPP)
