NEWS: True North moves to end Publicis row

True North Communications has set up a committee with sweeping powers to resolve the festering dispute with its European partner, Publicis.

True North Communications has set up a committee with sweeping powers to

resolve the festering dispute with its European partner, Publicis.



True North’s members are understood to be angry about how little room

for manoeuvre they have to change the way the alliance is structured in

the company’s key European market. And they blame True North’s senior

management for the problem.



Maurice Levy, the Publicis group chairman, has made it clear that the

Paris-based network will realise its global ambitions with or without

True North’s help.



Speculation is also mounting that Publicis wants to build on its

relationship with M&C Saatchi, with which it services the pounds 60

million global British Airways account, to share other major clients.



It is believed that the establishment of the committee will remove the

need for Levy to have direct dealings with his True North counterpart,

Bruce Mason. The two men have scarcely disguised their dislike of each

other.



Levy declined to comment on the True North move.



The global alliance between True North, the Foote Cone Belding holding

company, and Publicis formally ended after seven years on 1 March.



Both parties are continuing to co-operate while they try to renegotiate

their relationship. However, they are free to buy other agencies or

create new ones.



‘Everything is on the table for discussion and no option is being ruled

out,’ a True North senior manager in Chicago said. ‘The members of the

committee are well known to Levy and we hope they can unblock the log-

jam. What have we got to lose?’



However, senior Publicis sources see the establishment of the committee

as an act of desperation and are heavily critical of True North for what

they claim is a lack of international vision.



Publicis believes it has the upper hand because of its 51 per cent

shareholding in the Publicis-FCB Europe joint venture. The company is

registered in the Netherlands, where the law prohibits companies from

competing with a partnership they have a stake in without the agreement

of the other partner.



‘True North can’t make any move in Europe without our agreement,’ a

Publicis source said. ‘It’s trapped.’



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