Martin Sorrell plans to replicate the 1980s formula that he used to build ad/PR conglomerate WPP from the corporate shell of Wireless and Plastic Products to create a multinational technology, data and content-oriented communications company.
Derriston Capital today announced that it has been acquired by S4 Capital, a Jersey-incorporated business established by Sorrell in April.
Sorrell kicked in $53M of S4’s $67M funding, a war chest that is earmarked “for the purposes of funding acquisitions in the communications services sector,” said Derriston’s London Stock Exchange filing.
S4 has non-binding commitments from institutional investors for nearly $200M in additional funding.
Sorrell, who is executive chairman, owns a 75 percent stake of S4’s 464M outstanding shares and has incentives that would entitle him to 15 percent of its growth in the value of its shares, as long as “the company or its shareholders receive a six percent preferred return.”
In its statement, Derriston noted that Sorrell “acquired a significant stake in WPP in 1985 when its market capitalization was approximately $1.3M: WPP now has a market capitalization of in excess of $20B.”
Its directors jumped at the opportunity to work with Sorrell because they believe his leadership will provide “an accelerated route to grow the company.”
Paul Roy, who was co-president of Merrill Lynch’s global markets and investment banking division, and Rupert Faure Walker, a financier who advised WPP on its acquisitions of JWT, Ogilvy & Mather and Cordiant, join Sorrell on the board of S4.
Walbrook PR Limited's Paul McManus and Nick Rome handled Derriston's announcement.