Shareholders of WPP ScanGroup will wait longer for settlement of a Sh1.49 billion loan lent to its British parent WPP Plc after the company disclosed it intends to continue deferring repayment of the debt for the foreseeable future.
The loan was one of the issues brought up by minority shareholders of the Nairobi Securities Exchange (NSE) listed firm in their bid to change the company’s board of directors during the June 8 Annual General Meeting. Their efforts however failed after WPP voted its majority 56.26 percent stake-equivalent to 243.1 million shares-against the resolutions.
ScanGroup says in its 2025 annual report that the long-term loans recoverable from WPP had a gross value of Sh1.49 billion at the end of last year. The company had made a provision of Sh306.9 million for expected credit loss on the loan, leaving a net recoverable amount of Sh1.19 billion.
These loans are denominated in dollars ($6.26 million) and euros (pound 2.57 million). ScanGroup has not disclosed the annual interest payable on the loan.
‘It is the intention of WPP ScanGroup Plc and WPP Group Services SNC that the loan advanced to WPP Group Services SNC will remain outstanding for the foreseeable future.
Although the loan agreements provide for a contractual repayment period of within one year (on demand), the loans have, in practice, been rolled over historically,’ said ScanGroup in its 2025 annual report.
‘WPP ScanGroup, as the lender, has both the ability and the intention to defer settlement for a period exceeding 12 months. Accordingly, management has assessed the loans to be long-term in substance and has therefore classified them as non-current assets in the financial statements.’
WPP Group Services SNC, based in Brussels, is part of WPP Plc’s far-flung operations. WPP Plc took a minority stake in ScanGroup in 2006 before acquiring additional shares from 2013 to take its holding above 50 percent.
The ScanGroup loan to WPP first appeared on the Kenyan firm’s books in 2023, when it closed the year with an outstanding amount of Sh156.74 million ($1 million at the December 2023 exchange rate).
The gross value climbed to Sh821.25 million in 2024, before rising further to the current value of Sh1.49 billion. Over the three-year period, the provision for expected credit loss has remained unchanged at Sh306.9 million.
Minority shareholders led by Scangroup’s founder and former Chief Executive Officer Bharat Thakrar -who has a 10.48 percent stake in the company- took issue with the decision to advance the loan amid losses and failure to pay dividends for years.
The marketing services firm has continued to report losses on the back of increased competition, loss of key customers and the disruption of the industry by artificial intelligence, among other technologies.
ScanGroup reported a net loss of Sh713.6 million in the year ended December 2025, up from a net loss of Sh506.74 million in 2024.
The company’s top line revenue fell to Sh2.04 billion from Sh2.44 billion in 2024, attributed to client exits and reduced media and advertising spending by certain clients.
In May 2025, ScanGroup’s subsidiary Ogilvy Africa parted ways with its top client Airtel Africa, after 15 years of acting as the marketing and advertising agency of the telecoms operator across the continent.
The Airtel business moved to rival French multinational agency Publicis Groupe Africa via its local affiliate The Partnership Africa, which was founded in 2023 by former Scangroup executives who spent at least a decade each at the company.
The Partnership Africa’s Chief Executive Officer Sandeep Madan headed ScanGroup’s wholly owned subsidiaries Scanad Africa and J. Walter Thompson East Africa between 2012 and 2023, having previously been CEO of Ogilvy Africa a year-and-a-half.
The company’s chief operations officer Sally Sawe served as managing director at Scanad and JW Thompson between 2015 and 2023, while chief creative officer Deepesh Jha held a similar role at Scanad between 2018 and 2023.
Besides ScanGroup, other NSE listed firms have at various times provided loans to their multinational parents, often on more favourable terms compared to local market rates.
In 2022, Bamburi Cement gave its parent Holcim a dollar denominated Sh3.5 billion loan at an annual interest rate of 1.4 percent. Holcim in turn lent Bamburi’s Ugandan subsidiary Hima Cement Sh2.2 billion at a rate of 5.41 percent.
Bamburi has since been fully taken over by Tanzanian conglomerate Amsons Group in a deal that closed in December 2024.
The Sh23.6 billion buyout was primarily backed by an agreement by Holcim to sell its entire 58.6 percent stake to Amsons.
Earlier in March 2024, Bamburi sold its 70 percent holding in Hima Cement for Sh12 billion to a consortium of Ugandan firms Sarrai Group and Rwimi Holding.