The union between Scangroup and London listed WPP Group in 2008 was billed the perfect match to generate outsized profits and dividends for the Kenyan and UK advertising firms.
WPP went on to get a majority stake in Scangroup to fix piece in its strategy of a larger share of emerging markets, notably in Africa.
For then Scangroup Chief Executive Bharat Thakrar, the deal announced the Kenyan firm to the global stage and offered a gateway to conquer Africa.
First forward to 2026, and the union has turned messy, with Mr Thakrar securing a June 8 date to square off with WPP in his attempt to oust Scangroup’s CEO and board, backed by UK advertising group.
WPP-Scangroup Plc will on June 8 hold an annual general meeting that will see minority shareholders, including Thakrar, seek the ouster of the entire board of the marketing and communications firm, citing a string of poor financial performance.
The minority shareholders, with a combined 13.59 percent stake, had sought a special general meeting to oust the board, citing ‘serious concern at the continued deterioration’ in the company’s financial, commercial and strategic position since 2021.
However, WPP Scangroup has opted for an annual general meeting (AGM) for the re-election of directors and listed Mr Thakrar’s push under special business, according to the notice published on Friday.
The AGM has listed the minority shareholders’ push under special business, coming after the ordinary business in which current board members-including Chairman Richard Omwela, Patricia Kiwanuka, Kagiso Musi, Nick Douglas and Manuel Segimon-have offered themselves for re-election.
Mr Thakrar, the founder of ScanGroup, exited the firm in 2021 following a fallout with WPP and has sued the firm and its parent company, WPP Group, for $£24 million (Sh4.22 billion), citing irregular removal.
He and the other five minority owners, are pushing for the removal of the directors and CEO.
They have proposed the appointment of Mr Thakrar, Andrew White, Carl Adam Ogola, Kunal Kamlesh Bid and Rishab Bharat Thakrar as the new directors.
The AGM will test the power of the minority owners against the majority shareholder, WPP, which has a 56 percent stake. Scangroup on May 13 indicated that three of the nine directors that the minority investors wanted out have retired.
It proposed to replace the three with WPP insiders, including a marketing manager and two finance executives, tightening its grip on the Kenyan subsidiary.
Mr White, was the executive creative director of Scangroup Africa until 2013. He is known for ad slogans like ‘Mimi ni Member for Equity Bank, ‘Let’s talk about Trust’ for Trust condoms, ‘Milele’ for Tusker and ‘Smooth all the way’ for Embassy cigarettes.
The minority shareholders say the company has issued four consecutive profit warnings, accumulated billions of shillings in losses, halted dividend payouts, lost key clients, including banks and Airtel Africa and cut its regional footprint and eroded shareholder value over the past five years.
The market value of the firm has more than halved since 2021, when its share stood at Sh5.60 a piece compared to the current Sh2.15.
In the letter, the minority shareholders say the Scangroup has incurred aggregate trading losses of about Sh3.3 billion between 2021 and 2025 when the net loss widened by 41 percent to Sh713.7 million from a Sh506.7 million loss booked in the previous year. Its revenues have dipped to Sh2 billion from Sh7 billion in 2021.
They are also questioning the terms of the Sh1.2 billion that Scangroup has lent to its parent firm, WPP, at an interest rate of five percent.
The shareholders say the five-year period has seen the company lose major clients, including KCB, Equity, NCBA and Airtel Africa. Stakes are high for both parties.
Mr Thakrar founded the firm in 1982 as a small independent advertising agency, then known as Scanad, before opening up to investors such as WPP for growth.
WPP took up a minority stake in 2006 before acquiring additional shares in 2013 to take its stake above 50 percent.
Mr Thakrar wants a comeback. Globally, WPP has unveiled plans to cut £500mn a year in costs by 2028 and sell non-core businesses as part of a sweeping overhaul of the UK advertising group.
It has outlined a restructuring plan to restore the company to growth by 2027, after a difficult period that resulted in it dropping out of the FTSE 100 index.
Mr Thakrar’s fights with WPP Scangroup echoes the acrimonious split that British ad conglomerate WPP experienced with its founder Sir Martin Sorrell, whose departure in 2018 was marked by an investigation into alleged misconduct and a prolonged battle over his shareholding.
Mr Thakrar had leaned on external investors such as WPP to fuel growth. The partnership proved vital in scaling up the business, moving the firm from Sh829.57 million revenue in 2006 to Sh5.02 billion in 2015 and more than doubling the net profit to Sh478.67 million from Sh195.52 million.
The year 2015 saw Scangroup rebranded to WPP Scangroup, with Mr Thakrar saying this signified that the two firms were now ‘fully together.’
‘This is aptly captured by the famous African proverb that says: ‘If you want to go quickly, go alone. If you want to go far, go together,” Mr Thakrar said.
However, 2015 proved to be the peak for the company, with the revenues beginning to tank the following years.
A brief recovery set in but the firm has struggled to recover from post-Covid disruptions, posting net losses since 2021 except for the Sh130.14 million net profit in 2023.