Sir Martin Sorrell resigned after 31 years as CEO of WPP plc, the British holding that controls WPP Aunz Ltd (ASX: WPP). Chairman Roberto Quarta will serve as executive chairman until a new CEO is appointed.
In 1985 Sorrell acquired shopping baskets manufacturer WPP and through a series of takeovers transformed it into an advertising empire with offices in 112 countries. In 2016 WPP merged its Australia and New Zealand division with STW Communications to create WPP Aunz – the largest marketing group in the region.
Sorrell was recently criticised for allowing himself generous pay packages. At the beginning of April WPP's board hired a law firm to investigate on his alleged improper use of company assets. Details of the allegations weren't disclosed, but the company stated the amounts involved were not material.
The investigation has now concluded, and Sorrell – who denied all allegations – steps down at a difficult time for WPP and its subsidiaries, as large companies cut their spending on advertising and marketing firms face increasing competition from internet giants. WPP Aunz's share price fell 23% in the past 52 weeks.
Investors don't seem to fear that a change at the helm will hurt the company: WPP Aunz is currently trading flat at $0.92.
