LONDON (ShareCast) - (Sharecast News) - Citi has reiterated its 'buy' call on advertising and media giant WPP after the company rejected a KKR bid to take control of its corporate PR firm FGS Global.
According reports on Thursday, KKR, which already owns 29% of FGS following a deal last April, wanted to take a majority stake in the firm but 55%-owner WPP didn't consider FGS as "for sale".

Citi said the development could reveal "considerable hidden value" at WPP as the big increases pressure on the company to "accelerate the pathway to shareholder value including a broader review of its holdings and owned/operated assets".

The bank said: "Fully dismantling the holding company would not likely be plan A for the management of WPP, in our view.

"This said, the magnitude of the gap between public market and private valuations of the PR business, in particular, suggests there is a potentially fairly significant opportunity for WPP to create value for shareholders without significantly undercutting the longer-term prospects for growth."

WPP's shares were down 1.1% at 733p by 1130 BST.

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