WPP expands digital market in S. America

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BUENOS AIRES, Jan. 2 (UPI) -- Latin America's growing potential as a homeland security and telecommunication market is to be explored as telecoms group WPP positions itself for market expansion in South America.

WPP this week announced its part acquisition of Globant, the digital marketing specialist that has headquarters in Buenos Aires.

Digitization and computerization including smart metering is on the rise across Central and South America, with the biggest growth reported in Brazil, Chile and Argentina. Mexico is seen taking the lead in Central America and the Caribbean from its vantage point in southern North America.

WPP said its acquisition of Globant will further strengthen its digital capabilities in the fast growth markets of Latin America and in the United States and beyond

WPP is taking a 20 percent stake in Globant S.A., generally rated as an emerging worldwide leader in providing both technical expertise and design and creative capabilities in the development of software product.

Globant says its software and related products can be applied to digital marketing campaigns on a global scale.

Gobant employs 2,700 engineers, marketing specialists and designers in 21 offices across 14 cities in Argentina, Brazil, Colombia, the United States, Uruguay and the United Kingdom.

The company says its approach is "unique" as it provides clients with both the infrastructure and technical support that drive digital marketing campaigns, combined with the creative and design skills that usually found alone in digital agencies.

Globant's net earnings in 2011 totaled $90 million and revenues in the six months to June 30, 2012, topped $56.9 million.

WPP says it will invest about $70 million in acquiring the Globant stake.

WPP's acquisition of the Global stake is rooted in changing perspectives on how to make IT companies more profitable and their marketing campaigns better coordinated.

"Increasingly, clients want better coordination between their IT departments and their marketing departments, between their chief information officers and their chief marketing officers," WPP Chief Executive Officer Martin Sorrell said.

"There are many consulting companies or digital agencies that are expert in one function or the other. Few, if any, do both and even fewer can integrate deep technical and creative capabilities on a global scale as Globant does," Sorrell said.

The deal will allow the companies to increasingly provide clients with insights and skills that will make their digital marketing efforts even more effective and simpler to manage at both the front and back ends.

Globant says it has deep experience in working in state of the art digital marketing spaces including, but not limited to, mobile, gamification, social networks, cloud computing, big data and e-commerce.

Globant's clients include American Express, JP Morgan Chase & Co., LinkedIn, Electronic Arts, Google, Coca-Cola, National Geographic, Zynga and Sabre Holdings, as well as a number of WPP companies, such as JWT, Young & Rubicam, Grey, GroupM and Kantar.

Globant Chief Executive Officer and co-founder Martin Migoya said the company's "core competencies" in gamification, cloud computing, big data, social networks and mobile would enable it to deliver innovation to customers and add value to their efforts to reach end users through software products.

He said WPP support will help the company to achieve its goal of becoming one of the most innovative software development companies.

WPP, the world's largest communications services group, reported billings of $77.1 billion and revenues of $16.1 billion in 2011.