WPP is to take full control of Australia's most famous advertising agency in a A$80m (£34m) deal.

The UK-based giant, the world's second largest advertising company, has completed negotiations to buy out the 70% of George Patterson Partners it does not already own.

WPP's chief executive, Sir Martin Sorrell, told analysts today that he had agreed terms overnight although no formal announcement has yet been made.

Speculation mounted in Australia that an announcement was imminent after regulators cleared the deal earlier this week.

The Australian competition and consumer commission said its "market concentration thresholds" would not be exceeded by the proposed transaction.

If WPP buys The Communications Group, the holding company behind Patterson, it is likely to combine the 71-year-old agency with its Young & Rubicam operation.

Also part of the deal are media agency Zenith, Professional Public Relations and Underline:Fitch, as well as the retail agency Ideaworks and outdoor company Media Puzzle.

WPP has owned 30% of Patterson since 2003, when it took over Cordiant.

Shortly before Cordiant's collapse, it sold a 70% stake in the business for A$61.2m to The Communications Group.

Of that stake, 55% is owned by private equity group Pacific Equity Partners, with the remaining 15% controlled by its management.

Patterson, known as Patts in Australia, was responsible for signing up Paul Hogan to advertise Foster's lager and was famous for its Victoria Bitter adverts.

It was bought up in the 1960s by the Bates network, which became part of Cordiant in 1986.

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