WPP PLC (LON:WPP) could sell a minority stake in its Chinese unit to two of the country’s biggest conglomerates, Alibaba and Tencent, Sky News reported at the weekend.
Citing unidentified sources, Sky News said the two firms, along with China Media Capital Holdings, were in early-stage discussions about buying roughly 20% of WPP China in a deal that would value the business between US$2bn and US$2.5bn.
READ: Sorrell wins €300mln bidding war with ex-employer WPP for MediaMonks
The report said the China deal, which could take several months to conclude, would see WPP pool its Chinese agency operations into a new holding company and retain majority ownership and control.
Sky News added that the deal has been brewing since before WPP’s founder Martin Sorrell left abruptly in April, and the FTSE 100-listed firm’s executive chairman Roberto Quarta and its co-chief operating officer Andrew Scott went to China this month to continue talks.
Sorrell left the world's biggest advertising group, following a complaint of personal misconduct, and last month WPP said that the search for his replacement was well-advanced.