Shares of Omnicom lower after initial rally

|About: Omnicom Group Inc. (OMC)|By:, SA News Editor

Shares of Omnicom (OMC +0.9%) have fallen back quite a bit after trading over $70 earlier in the day following news of its mega-merger with Publicis.

At first blush, the deal looks like a way to create synergies through scale, but Simulmedia's Dave Morgan has a different take. He notes that while TV networks might see some pressure on ad rates from the combination of the two ad firms, the auction-based nature of online media advertising will dampen the impact of scale.

Other analysts think regulators in the U.S. and Europe could create an issue for the combined company.