Microsoft puts Razorfish up for sale

Microsoft has appointed Morgan Stanley to find a potential buyer for Razorfish, its digital agency.
Publicis, the French marketing company that says it is planning more acquisitions in online advertising, is thought to be a possible bidder.
Microsoft acquired the agency, formerly called Avenue A Razorfish, as part of its $6bn takeover of aQuantive in 2007.
One analyst valued Razorfish at $600m-$700m, based on sales of about $400m last year and profit margins for similar businesses of 12-13 per cent.
The analyst said: “Much more than that would be overpaying”, adding that even in digital marketing, valuations had fallen since last year, when Advertising Age trade magazine reported a valuation of $800m
In August, two years after the aQuantive deal, more favourable tax implications will provide an opportunity for Microsoft to sell an asset some view as a conflict of interest with Microsoft Advertising, which sells technology to rival agencies. Maurice Lévy, Publicis chief executive, said funds from a refinancing this month could be used for acquisitions, particularly in digital and emerging markets, which are performing better than traditional advertising in the US and Europe.
“There are some opportunities” for acquisitions, he said.
“Obviously if we can take advantage of the current situation to be ready to take these things, it’s good.”