Dentsu Steps Out Of Russian Market, Transfers Ownership To Local Partner

0

Denstu International, part of the Japanese advertising agency group Dentsu, has revealed that it is in the process of transferring the ownership of its joint venture in Russia in response to the country’s invasion of Ukraine.

Following the response of rival agency networks WPP, IPG and Publicis Groupe, the company has released a statement to reveal that it has moved to take itself out of Russia as the pressure increases on companies and brands to support economic sanctions upon the country to dissuade the continued attack on its neighbor.

Dentsu stands with Ukraine

“Dentsu stands unequivocally with Ukraine and the global community who are calling for the restoration of peace. In these unprecedented times, as a global business we will continue to prioritize the safety of our people and the needs of our clients,” read the statement which explained that it operated an affiliate partnership in Ukraine, employing 500 people.

In Russia, the company has held a long-term partnership for over a quarter of a century and will transfer ownership to them to operate independently. The company declined to name the local partner however.

“We have not made this decision lightly as we have 1,500 people in Russia who have supported Dentsu and our clients over many years.”

In 2005, Aegis Network (Now Denstu International) acquired shares in Moscow based HMS Komandarm seven years before the company itself was acquired by Dentsu. This would eventually become part of the group’s media buying agency Carat.

In 2020, Dentsu created a Russian-focused join venture with OKS Group to create a new subsidiary to create Dentsu Entertainment Eurasian Partners (DEEP), which would aim to develop new market solutions and smart technologies. The initiative was led by Michael Voschinsky as CEO. He had been working with the business since 2006 when he was appointed CEO of Vizeum network agency launched in Russia in 2005.

A spokesperson told Adweek that Dentsu Group “suspended this small subsidiary in Russia earlier in the month.”

Dentsu Group has also announced that it will donate $840,000 (100 million yen) to those affected in Ukraine and surrounding countries alongside the $328,000 (38 million yen) already donated to the Ukrainian Red Cross Society last month.

Credit: Ad Week

Leave A Reply

Your email address will not be published.

This site uses Akismet to reduce spam. Learn how your comment data is processed.