Omnicom To Acquire Elsevier's Pharma Communications In Japan

Omnicom Health Group, a division of Omnicom Group Inc. (NYSE:OMC) , announced that it has inked a definitive agreement to acquire Elsevier's Pharma Communications business, which is part of the RELX Group, RELX PLC (NYSE:RELX) , for an undisclosed amount.

The acquired business has been a leading healthcare communications business in Japan for 38 years. It enjoys a reputation for quality delivery of medical content for promotional materials and educational programs directed at doctors and patients.

The acquired business and employees will become part of the newly named healthcare marketing communications agency, EMC (NYSE:EMC) K.K. The acquired unit's management team will also join EMC while Takao Ozawa will be the Managing Director. He will report to David Stark, CEO of Omnicom Health Group Asia Pacific (OHG AP).

EMC further strengthens OHG's roster of leading healthcare agencies in Japan, including Targis, Rx Healthcare, Polaris Consumer Health, CDM Tokyo and MCI.

Having a solid credibility, OHG will get an opportunity to expand its business in Japan, which is the world’s second largest pharmaceutical market. Also, the addition of EMC's talented healthcare specialists and their long-term good standing in the market will add value to OHG services and enable the company to meet growing client demand and maintain the best service offering in Japan.

With EMC, OHG will have unmatched scale, depth and breadth of dedicated healthcare communications services. The transaction is expected to close in the second quarter of 2018, subject to customary closing conditions.

Omnicom continues to expand its global footprint and explore new service areas. It is also building upon its digital and analytical capabilities by investing in agencies and partnering with innovative technology companies in key markets. The company is currently concentrating on strengthening its business while expanding client base globally. The company maintains a balanced growth model through a combination of well-focused internal development initiatives and strategic acquisitions. We expect the company to witness higher revenues in the future on the back of its focused growth initiatives.

The stock has outperformed the industry in the last three months with an average loss of 0.2% compared with a decline of 5.5% for the latter.



Zacks Rank and Stocks to Consider

Omnicom carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the broader industry are The Interpublic Group of Companies, Inc. (NYSE:IPG) and Automatic Data Processing, Inc. (NASDAQ:ADP) , both carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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