CLOSE-UP: PERSPECTIVE; GGT-BDDP deal is the right move at just the right time

By STEFANO HATFIELD, campaignlive.co.uk, Friday, 27 September 1996 12:00AM

Mike Greenlees was trying very hard not to appear like the cat that got the cream last week. After Campaign bounced him into revealing his successful bid for BDDP, he had to spend a couple of long nights preparing statements and talking to clients. By day, his phone was hot with congratulations from industry mates. If he was tired it didn’t show - his elation did though.

Mike Greenlees was trying very hard not to appear like the cat that got

the cream last week. After Campaign bounced him into revealing his

successful bid for BDDP, he had to spend a couple of long nights

preparing statements and talking to clients. By day, his phone was hot

with congratulations from industry mates. If he was tired it didn’t show

- his elation did though.



Some might find this strange given the facts that for years now the name

BDDP has been prefixed by the adjective ‘ailing’, that GGT takes on debt

and that other interested bidders implied that the asking price was too

high. Some Brits even have a strange fear of doing business with the

French.



However, the final price (pounds 105 million) was much lower than the

figures first bandied about, and, more importantly, GGT needed this

deal. In fact, the marriage of the two agencies is a near-perfect fit

and has been received as such in some refreshingly positive commentary

on both sides of the Atlantic. What’s more, the BDDP fit was only truly

snug with GGT. WPP would have had to sell off Wells Rich Greene in the

US because of a Procter and Gamble/Unilever conflict, and Grey would

never have had the support of the talented BDDP senior management.



Greenlees has tried unsuccessfully to escape from the middle before -

with Young and Rubicam in 1993.



He has an interesting view on global consolidation, noting that one of

the reasons major manufacturers do it in their own businesses is ‘price

resilience’. It is difficult to achieve this in a British ad industry

where not one of your numerous rivals has more than a 5 per cent share

of the whole.



Of course, this deal won’t make a huge difference in Britain itself,

where, for now, there remain two mid-size agencies, but the global

picture is telling. Interpublic has three major networks; Omnicom three;

WPP two; Cordiant runs three (including Zenith). Consolidation involving

one or more of Publicis, True North, Y&R and Bozell appears imminent.

Meanwhile, Leo Burnett, Grey, DMB&B and Euro RSCG are buoyed by the

strength of their relationships with the multinational clients Greenlees

covets.



Greenlees’s only other option was unrealistic - to take GGT private

again and be a local hotshop. That market is hardly any less competitive

in the UK, with agencies such as BBH, Simons Palmer, Rainey Kelly,

Duckworth Finn and Howell Henry all thriving. Greenlees himself

acknowledges that maybe GGT would have been a more successful agency if

it had stayed private. But it didn’t. Having made the decision it had to

keep growing. Within that context, and with the reminder that GGT-BDDP

now needs to win new business organically, this is a very good deal.



This article was first published on campaignlive.co.uk

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