The Bates network is set to increase its grip on the Hyundai
business by taking over Diamond Advertising, which handles the
carmaker’s account in its South Korean home market.
Cordiant, the Bates parent company, is understood to be paying more than
dollars 100 million for Diamond in a deal that will allow its existing
management to remain in place for the next three years.
Hyundai is the largest Bates client in the US, where it bills dollars
108 million, and Michael Bungey, Cordiant’s chief executive, has been
trying to develop it into a global client.
Cordiant declined to comment on the sale, which was to have formed part
of this week’s announcement of the company’s purchase of the US-based
Healthworld Corporation (see story, p5). However, last-minute details
are believed to delayed the agreement.
The relationship between Bates and Diamond, an Hyundai subsidiary, began
when the two formed a joint venture in April 1996 called Diamond Bates
Korea, in which Bates had a 40 per cent stake.
The aim was to provide Diamond with more international access while
giving Bates and its then sister network, Saatchi & Saatchi, an entree
into the South Korean market.
Bates already had the Hyundai business in the US and its alliance with
Diamond helped pave the way for its appointment last year to run a
pounds 13 million pan-European campaign for the company.
The assignment led to the setting up of a separate unit within Bates to
avoid a clash with its pounds 100 million pan-European SEAT
Diamond is understood to have been on the market for some time although
the depressed state of the Asian economy is said to have dissuaded other
networks from stepping in with offers.