FCB senior managers reacted with relief this week at the news that
the network's True North parent is to join the Interpublic stable in a
pounds 1.47 billion deal.
As the agreement creating the world's largest communications group was
announced on Monday morning, executives were not hiding their delight
that True North was coming under the wing of a US group rather than the
'All the people here were rooting for Interpublic,' Harry Reid, FCB's
international president, said. 'Havas might have worked out but there's
a much closer cultural connection between the top guys here and at
But the marriage will have to go through an early pain barrier with the
possible closure of True North's Chicago headquarters - and resulting
job losses - likely to happen in order to satisfy the declared intention
of John Dooner, Interpublic's chairman, of making annual savings of more
than pounds 17.5 million.
The deal ends a period of speculation about the future of True
It was heightened by last November's loss of FCB's dollars 1.5 billion
DaimlerChrysler business, which accounted for an estimated 25 per cent
of the group's profits.
'We had to show our clients and staff that we were in an end game,'
David Bell, True North's chairman and chief executive, explained. 'Now
all the speculation and 'what-ifs' are eliminated and we're focused on
As businesses converge, networks have found it increasingly hard to
provide the diverse range of marketing services the new mega-clients
demand in order to promote their brands cost effectively.
Bell, who becomes vice-chairman of Interpublic, said: 'Today's
multinationals have bigger needs than any single agency network can
provide. FCB, as a global network within Interpublic, can accommodate
those needs. True North could not have paid what Interpublic can afford
to give us the extra resources.'
Much is being made of the personal friendships between Dooner, Bell and
Brendan Ryan, FCB's chief executive, which stretch back more than 20
What's more, Interpublic is singled out as offering more scale and
credibility than either Cordiant or Havas, both of whom have been in
talks with True North.
By throwing their lot in with Cordiant, some FCB chiefs feared they
might simply be helping to prop up a fractured structure with
problematic operations in the UK and the US. Meanwhile, Havas provoked
memories of True North's disastrous marriage with France's Publicis and
concerns that another cultural divide might open up.
Publicis still holds more than 9 per cent of True North's stock, a
legacy of the two groups' bitter divorce four years ago. A failed
hostile bid by Publicis for its former global partner only exacerbated
the bad feeling.
Maurice Levy, the Publicis chairman, who is examining options with the
group's financial advisors, this week cast himself in the role of
spectre at the feast, labelling the Interpublic offer as 'peanuts'.
Levy's view is that True North has only itself to blame for its
He told Campaign: 'The sale of the company is the result of the wrong
strategy and a series of mistakes. What's been offered is a price with
no premium. It's unheard of. I've never seen a company offered to a
competitor without a premium. It's very disappointing.'
There are concerns also that FCB, whose multinational clients include SC
Johnson and Compaq computers, does not add enough prestige or diversity
to Interpublic's existing network line-up of McCann-Erickson and the
Lowe Group. But, as one FCB chief remarked: 'When you're the size of
Interpublic, extra diversification becomes very difficult.'
In Europe, FCB relishes what it believes is the potential for
cross-referred business that the deal will bring as well as the extra
resource to develop a network ,which still languishes in the lower
reaches of the top twenty rankings.