David Kenny Leaving Publicis, as CEO Levy Delays Retirement

David Kenny, who as CEO of Digitas helped broker the agency’s $1.3 billion sale to Publicis nearly four years ago, is stepping down from the holding company and its board of directors.

The reason given is that Kenny could not relocate to Paris for family reasons, and that his future responsibilities would have required him there. His resignation takes effect June 30, 2010.

Many at Publicis believed Kenny was in line for the CEO job. However, Kenny has two children in Boston-area schools, and according to one source, his family simply did not want to relocate. Evidently, the holding company was unwilling to consider the possibility of a U.S.-based CEO.

Possibly as a result of its breakdown with Kenny, Publicis has asked CEO Maurice Levy to postpone his retirement, which he agreed to do. Levy had been scheduled to step down in spring 2011, after a search for his replacement. However with today’s announcement about Kenny, the company said Levy will continue in his current role beyond 2011.

By many accounts, Kenny played a key role in driving Publicis’s interactive strategy and designing its digital organization, and had considerable clout on the company’s board. For instance, it was under Kenny’s guidance that Publicis created a central unit, Vivaki, to house its digital media services, which he led as CEO.

Kenny was also heavily involved in Publicis’ negotiations with Microsoft to acquire Razorfish, and in its controversial decision to commit up to $2 billion in media spending to Microsoft over five years.

Going forward, Managing Director Jack Klues will lead Vivaki as CEO, overseeing Digitas, Razorfish, Starcom MediaVest Group, and ZenithOptimedia. Klues founded Starcom MediaVest in 2000.

Publicis also named a new chief operating officer, Jean-Yves Naouri, and appointed Jean-Michel Etienne to its management board.