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Alibaba and Tencent in frame to acquire 20% of WPP China

Alibaba Group and Tencent‎ Holdings are reportedly in talks to buy a 20% stake in WPP China in a deal understood to have been first mooted by former chief executive Martin Sorrell.

Discussions are thought to be at a very early stage, according to Sky News, with WPP chairman Roberto Quarta and co-chief operating officer Andrew Scott said to have travelled to China this month for exploratory talks.

The deal would see Alibaba Group, Tencent‎ Holdings and China Media Capital Holdings (CMC) join forces and take an equal shareholding in a new holding company.

Banking sources told Sky that Martin Sorrell had raised the prospect of a deal with Ruigang Li, one of WPP’s non-executive directors and founder of CMC‎.

Ruigang’s deal role, and the overall complexities of such a deal, may scupper any agreement, sources warned.

Joint ownership of a stake in WPP China would be seen as something of a surprise given the competitive tensions between Alibaba and Tencent.

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