Break up19 Apr 2018 20:03
Analysts at London brokerage Liberum described Mr. Sorrell as "the glue that bound much of WPP together."
Kantar, the company's market research unit, is "the most obvious candidate for disposal," Liberum wrote in a research note, adding a sale could raise 3.5 billion pounds to reduce debt or return cash to shareholders.
Alex DeGroote of Cenkos, the London brokerage, said separating the company's digital, advertising, market research and other assets could lead to a 40% rise in the share price.
"The problem isn't replacing Martin. The problem is that the model doesn't work," he said.
Mr. Read is serving as chief operating officer alongside Andrew Scott, previously WPP's corporate development director and chief operating officer for Europe, until a new CEO is found.
WPP's board has tapped New York-based recruitment firm Russell Reynolds to conduct a global search to replace Mr. Sorrell, according to a person familiar with the matter.
The next CEO will need to review WPP's strategy at a time when the company faces a quickly changing digital advertising landscape and pressure from clients that are moving their marketing spend away from traditional agencies.
On Omnicom Group Inc.'s earnings call Tuesday, Mr. Wren said Kantar was "not a key focus for our acquisition dollars," adding: "There will be any one of a number of other buyers, including probably private equity."
Publicis Chief Executive Arthur Sadoun declined "to speculate on the future of WPP" when he was asked on an earnings call Thursday about the possibility of acquiring WPP assets.
Under Mr. Sorrell, WPP moved to align its different agencies, cut costs and allow clients to work with advertising staff that previously had been siloed. WPP executives often refer to this approach as "horizontality."
"There's universal admiration for Martin's achievements, and sadness about his departure," Mr. Read said. "At the same time, there's a huge amount of support and goodwill for the company, and no shortage of confidence about the future."
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