Sir Martin Sorrell is turning to a former boardroom colleague to help rebuild investor confidence in S4 Capital, the marketing services empire he began constructing four years ago.
Sky News has learnt that Colin Day, who was a non-executive director at WPP Group and had stints as the finance chief of Aegis Group and Reckitt Benckiser, will be named this week as the new chair of S4’s audit committee.
The appointment of Mr Day, who will join the board of S4 as a non-executive director, will reunite him with Sir Martin, WPP’s founder and former chief executive.
It is expected to be announced on Tuesday.
The appointment comes nearly five months after S4 delayed the publication of its results hours before they were due to be released to the stock market, citing the inability of auditor PricewaterhouseCoopers to sign them off.
Sir Martin’s group, which has grown rapidly since 2018 through dozens of acquisitions, eventually released the figures in May.
Since then, however, a warning that profits would be lower than expected this year has triggered a further sharp fall in S4 shares.
A person close to the company said the appointment of Mr Day, a boardroom veteran who has also run Essentra, the industrial products group, was intended to restore shareholders’ conviction in S4’s corporate governance.
Mr Day is a non-executive director of the Department for Environment, Food and Rural Affairs, and is expected to step down from the board of Meggitt when its £6.3bn takeover by Parker-Hannifin completes.
As chair of S4’s audit committee, he will replace Rupert Faure Walker, who has held the position since 2018.
The recent series of mishaps has sparked a startling decline in S4’s valuation, with the shares tumbling by nearly 80% over the last year.
That decline partly reflects the wider deterioration in sentiment towards technology-based stocks on public markets around the world in recent months.
Sir Martin has continued to acquire companies at S4 even since the audit delay and profit warning.
The latest deal was announced a month ago, and saw Media Monks, S4’s creative digital content production company, merge with XX Artists, a Los Angeles-based social media marketing agency.
In total, S4 now employs more than 9,000 people across more than 30 countries, and counts multinationals like Adidas, BMW, and Google among its clients.
Sir Martin’s conviction about the timing of his ‘next-generation’ approach to building an advertising holding company has been reinforced by the pandemic, with a surge in online and other digital spending by brand marketers.
Previous takeovers by S4 have included Circus, an agency which counts Facebook, Google, and Spotify as clients, Firewood, the largest marketing agency in Silicon Valley, and Orca Pacific.
On Monday, shares in S4 closed at 132.6p, giving it a market value of more than £700m.
S4 declined to comment.