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Basis of Presentation and Recent Developments | 3 Months Ended
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Mar. 31, 2021
Organization, Consolidation and Presentation of Financial Statements [Abstract] |
Basis of Presentation and Recent Developments | Basis of Presentation and Recent Developments MDC Partners Inc. (the “Company” or “MDC”), incorporated under the laws of Canada, is a leading provider of global marketing, advertising, activation, communications and strategic consulting solutions. Through its Networks (and underlying agencies generally referred to as “Partner Firms”), MDC delivers a wide range of customized services in order to drive growth and business performance for its clients. The accompanying consolidated financial statements include the accounts of MDC, its subsidiaries and variable interest entities for which the Company is the primary beneficiary. MDC has prepared the unaudited condensed consolidated interim financial statements included herein in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) for reporting interim financial information on Form 10-Q. Accordingly, the financial statements have been condensed and do not include certain information and disclosures pursuant to these rules. The preparation of financial statements in conformity with GAAP requires us to make judgments, assumptions and estimates about current and future results of operations and cash flows that affect the amounts reported and disclosed. Actual results could differ from these estimates and assumptions. The consolidated results for interim periods are not necessarily indicative of results for the full year and should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2020 (“2020 10-K”). The COVID-19 pandemic continues to negatively affect the global economy and the Company’s operations. The pandemic did not begin to impact the Company’s operations in a significant manner until the second quarter of 2020. Therefore, our first quarter of 2021 comparisons to the first quarter of 2020 are affected by the impact of the pandemic on our operations in the first quarter of 2021. Early in 2020, the Company took actions to combat the impact of COVID-19 on our operations. We will continue to monitor the worldwide public health threat, government actions to combat COVID-19 and the impact such developments may have on the overall economy, our clients and operations. If the impact of the pandemic is beyond our expectation, the Company believes it is well positioned through the actions implemented at the beginning of the pandemic to successfully work through the effects of COVID-19 in 2021. The impact of the pandemic and the corresponding actions are reflected in our judgments, assumptions and estimates in the preparation of the financial statements. The judgments, assumptions and estimates will be updated and could result in different results in the future depending on the continued impact of the COVID-19 pandemic. The accompanying financial statements reflect all adjustments, consisting of normally recurring accruals, which in the opinion of management are necessary for a fair presentation, in all material respects, of the information contained therein. Intercompany balances and transactions have been eliminated in consolidation. Certain reclassifications have been made to the prior year financial information to conform to the current year presentation. Recent Developments On December 21, 2020, MDC and Stagwell Media LP (“Stagwell”) announced that they had entered into a definitive transaction agreement (the “Transaction Agreement”) providing for the combination of MDC with the subsidiaries of Stagwell that own and operate a portfolio of marketing services companies (the “Stagwell Entities”). The combination and related transactions, including the domestication of MDC to a Delaware corporation, are referred to as the “Transactions.” See “Item 1. Business – Recent Developments” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020, filed on March 16, 2021, for a description of the Transactions. On May 7, 2021, MDC’s proxy statement/prospectus on Form S-4, as filed on April 30, 2021, which describes the Transaction Agreement, the Transactions, and related ancillary agreements in more detail, was declared effective by the SEC. MDC’s Board of Directors has scheduled a special meeting of shareholders on June 22, 2021 for the Company’s shareholders to vote on proposals to approve the Transactions and related matters. On April 26, 2021, the Company acquired the remaining 40% ownership interest of Gale Partners it did not already own for an aggregate purchase price of approximately $20,000. The purchase price will be made in a combination of cash and MDC Class A Common Shares, of which approximately $12,000 is deferred with payments due in April 2022 and 2023. As part of the closing date purchase price, the Company issued 2,131,574 Class A Common Shares to the seller in a private placement in reliance on exemptions from registration under the Securities Act of 1933, as amended.

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