Dentsu’s attempt to sell its international business is close to collapse after major trade buyers and private equity suitors walked away from negotiations, the Financial Times (FT) has reported.
Prospective buyers, including rival agency groups and private equity firm Apollo, dropped out of talks last year, leaving Bain Capital as the only remaining bidder. A person close to the process tells FT that Bain was "still interested, but with significant reservations.” Neither Apollo nor Bain Capital have commented on the record.
Dentsu president and CEO Hiroshi Igarashi has informed board members that Bain was unlikely to continue with talks over a deal and that the sale process had fallen apart, according to FT.
However, in a statement shared with Campaign Asia-Pacific, Dentsu said no decisions had been announced.
“There have been media reports concerning the Company’s international business, but no announcements have been made by the Company,” it said.
“The Company remains fully committed to rebuilding the international business, which is the top priority. The Company is making steady progress on rebuilding its business foundation and re-evaluating underperforming businesses. At the same time, the Company is actively exploring strategic alternatives, including comprehensive and strategic partnerships, to support clients’ continued growth while advancing initiatives aimed at enhancing corporate value.
“Should any matters arise that require disclosure, the Company will make an announcement in a timely and appropriate manner.”
Dentsu’s shares fell 11% in Tokyo, valuing the advertising group at about ¥835 billion ($5.3 billion).
Reports surfaced in August that Dentsu had appointed Mitsubishi UFJ Morgan Stanley and Nomura Securities to explore options ranging from selling a minority stake to a full divestment of its overseas operations, after the group posted weakening organic growth and cut its full-year forecast.
Campaign reported in November that APAC, excluding Japan, fell 10.1% in Q3, the steepest decline of any region, prompting Dentsu to formally downgrade its full-year outlook. The US and Canada posted a 3.4% drop in net revenue, while EMEA was also in decline.
By contrast, domestic business in Japan delivered +6.8% organic growth year-to-date and a 24.6% operating margin.
Campaign also reported on Dentsu's plan to restructure the international operations and cut more than 3,400 jobs.
In its third-quarter results, the company said it was “moving as planned” with a review of its overseas operations and confirmed that most of its ¥28 billion ($182 million) restructuring costs for 2025 will hit in the final quarter, with layoffs starting in December. The full programme totals ¥52 billion ($338 million), largely for severance.
On the analyst's call, Dentsu did not give any details of how much of the business had been fixed or what might be sold. Igarashi confirmed that Dentsu was in talks with potential partners and was considering a range of options, including divestments, joint ventures and capability-specific deals, across media, creative and CXM.
“We are not limiting this partnership consideration to a certain area,” he said. “It’s not just media, it’s not just creative, it’s not just CXM.”
Havas also publicly said in October that it “could be interested” in parts of Dentsu’s international business, but warned that the full network was “too big” to acquire outright.
Accounts warn of 'material uncertainty'
Annual accounts for Dentsu International, the UK-based operating company for the business outside Japan, warned last month of a "material uncertainty" over its future, even though it remained a going concern.
The accounts acknowledged Dentsu was “currently re-evaluating underperforming businesses” and “exploring strategic alternatives to enhance corporate value”, but “no decision has been made at the time of the signing of these financial statements” on December 9.
“There is material uncertainty related to the above events and conditions that may cast significant doubt on the entity's ability to continue as a going concern and, therefore, that it may be unable to realise its assets and discharge its liabilities in the normal course of business,” the accounts said.
“After careful assessment of the situation, the board considers it appropriate to adopt going concern basis preparing these financial statements."
Auditors require a company to make a “going concern” disclosure as part of accounting rules.
A spokesperson for Dentsu declined to comment on the Dentsu International accounts and referred Campaign to its statement in August about the review of corporate value and said it would “make an announcement in a timely and appropriate manner” if there were a further development.
Dentsu International was previously known as Dentsu Aegis Network and headquartered in London, a legacy of Dentsu’s acquisition of Britain’s Aegis Group in 2012. Dentsu dropped the international branding in 2023 in a move to what it called a “One Dentsu” strategy but it has continued to operate Dentsu International and file accounts at Companies House in the UK.
Ginza sale
Dentsu completed the sale of its former headquarters in Tokyo’s Ginza district in December and booked a gain of more than ¥30 billion ($200 million).
The company said its board approved the sale of the Dentsu Ginza Building on December 24, with completion slated for January 30, 2026.
The building (above), first opened in 1933, was a symbol of the company’s rise in post-war Japan and served as its headquarters until the late 1960s.
Dentsu said the sale will secure funds for capital allocation and reduce the rising maintenance and tax costs associated with the ageing property, as part of a wider effort to improve capital efficiency and simplify its balance sheet.
The company did not disclose the buyer.
The move comes as pressure mounts on chief executive Hiroshi Igarashi. The Financial Times said that Dentsu’s board fears shareholders may try to block his reappointment at the company’s annual meeting in March 2026, after repeated failures to revive or sell the international business.
Dentsu faces tougher competition from rivals post the Omnicom and Interpublic merger, and from the growing dominance of Publicis.
Dentsu's updated full-year financial results are expected in February 2026.
