MEDIA PERSPECTIVE: Post Tempus, MPG can't afford not to find a new partner

This is Campaign's awards week, but there is one winner you won't

be reading much about: Havas' Media Planning Group, undisputed winner of

the 2001 Wallflower of the Year prize.



As students of corporate takeovers know, that is no place to be in

today's market. Once a public company has committed itself to a merger

or takeover, it can be fatal not to go through with it. Remember

Kingfisher, which in 1998 went right up to the altar with Asda, only to

have Wal-Mart snatch its prize at the altar. Its strategy in tatters,

the Kingfisher of that era is now no more.



So, having gone for Tempus and failed, is MPG buggered? Well, it is

clearly between a rock and a hard place. The facts are that MPG is the

world's ninth-largest media buyer in a world where being ninth is as

good as 19th.



In Europe it ranks eighth and in the UK it is 12th. Strong in France,

Spain and Latin America, MPG is (literally) nowhere in Germany, Italy

and Scandinavia, and not much more than a pimple in the US. Little

wonder the Tempus deal made sense.



What then, given that Havas' stated ambition is to turn MPG into a

top-five buyer by 2003, are its options? Answer: not many.



MPG's most favoured route must be a big agency merger, probably in

tandem with Havas. But if you rule out Omnicom, IPG and WPP, you're left

with, well, Grey, Bcom3 and Cordiant, none of which are exactly

star-kissed. Cordiant clearly needs a deal and owns half of Zenith, but

since the other half of Zenith is already owned by Publicis, that

wouldn't much advance MPG. With its three partners, Bcom3 is already an

unwieldy beast preoccupied with its own problems. Which leaves Grey and

MediaCom, probably Havas' best chance for a deal. But then we've been

saying Grey is ripe for a deal for some years now, and still nothing has

happened. And it is also important to remember that what suits MPG may

not dovetail precisely with Havas' wider corporate agenda, and vice

versa.



Then there is Aegis. As the last independent, the other network sharks

are hardly likely to let Havas have a free run at Aegis, which would at

least push up the price if nothing else. And besides, there's the

inevitable competition issue in France, a potential deal-breaker.



Or MPG could buy up small media shops country-by-country. Hmmm, yes,

well - the best thing that can be said about this is that while it may

make MPG look like it's progressing, it would be at the pace of a

tortoise.



Fourth, as senior MPG people have indicated, there's always the

possibility of joint ventures with complementary media buyers. That's

true, but who's into joint ventures now? These days, ownership is

everything.



Which leaves MPG going into 2002 pretty much where it was a year ago,

except that its need is even more urgent, yet its options more

finite.



- Claire Beale is on maternity leave.



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