S4 Capital has confirmed that it has received an offer from MSQ Partners in regards to a possible combination of the two firms.

The UK-headquartered digital advertising and marketing services firm revealed that discussions with the firm, which is majority owned by One Equity Partners, are at a preliminary stage and there is no certainty that a transaction will be forthcoming.

S4 Capital added that the possible combination, if agreed, would be structured as an acquisition of MSQ and not an offer under the takeover of S4 Capital by MSQ.

The announcement comes as S4 Capital’s share price has fallen by over 93% in the last five years.

However, following the announcement earlier today, the advertising firm’s share price jumped by over 4%.

Investment director at AJ Bell, Russ Mould, commented: "S4 Capital confirmed merger talks with private equity – potentially providing a full stop on a buy-and-build venture which has struggled to gain traction after initially generating excitement. The shares are now worth a fraction of what they were at their 2021 peak."

---