Sir Martin Sorrell, the Executive Chairman of S4 Capital, has revealed the company’s next steps ahead of its relisting after being rebranded from Derriston Capital. The move also comes on the back of S4 Capital’s prospectus release, which outlines the company’s future.
In a statement, Sorrell said that S4 Capital will focus on three areas of growth in the initial stages. This includes the further development of a global digital content platform, a first-party data offering which fuels both digital media planning and creative ideas and lastly, digital media buying. Overall, the organisation looks to provide global, multi-national, regional, local clients and influencer-driven Millennial brands with “new age/new era digital marketing services”.
In addition, S4 Capital will be organised primarily on a unitary basis, with key people continuing to be incentivised through significant, equity ownership in the enterprise as a whole. Sorrell explained that this strategy and structure will deliver significant long-term value for share owners, particularly through organic growth, supported by strategically-focused acquisitions.
Moving forward, S4 is looking to expand its digital content platform into markets such as Japan, India and Germany, which have been marked as “new high potential growth territories”. The company is also exploring new areas of operation in line with its strategic objectives, in data analytics and digital media planning and buying.
Through MediaMonks, S4 is currently working with brands such as adidas, Corona, Google, Johnson & Johnson, Netflix and Shell through MediaMonk’s eleven offices in ten countries in the United States, Latin America, the Middle East and Asia Pacific. S4 will look towards more acquisitions as well as the investment and expansion of MediaMonks and other businesses, the prospectus added.
Acquisitions will be implemented by way of a two-stage process. The first stage comprising the identification of acquisition opportunities in various segments of the communication services market. Targeted sectors include content, data analytics, media planning and digital media buying.
Meanwhile, the second stage will comprise a rigorous and disciplined analysis of identified target businesses (including as to their ongoing funding requirements). The prospectus added that the group may run either or both stages of this process in respect of more than one potential acquisition opportunity at any one time.
This is because it is seeking to acquire content, data analytics capabilities and media planning and digital media buying capacity as a priority, the next priority being international expansion. The group will also focus on organic growth by seeking to broaden and deepen existing client relationships and developing new ones.
“The company will maintain a disciplined approach to acquisitions, both as to any acquisition consideration payable and the working capital requirements of any acquired business. However, given its focus on digital opportunities, valuations are likely to be full,” the prospectus added.
Most recently, S4 Capital successfully acquired Media Monks for €300 million in cash and shares outsmarting WPP.