Fund managers demand Cordiant change

A trio of fund managers, including the man who engineered the ousting of the Saatchi brothers from the agency they founded, are joining forces in a bid to drive through management changes at the beleaguered Cordiant group.

David Herro is linking with Julian Treger and Brian Myerson, who run Active Value Fund Managers which has just raised its stake in Cordiant to 9.06 per cent.

This is expected to increase soon to 10 per cent, triggering a demand for an emergency general meeting of shareholders to discuss the group's dismal performance which has led to its share price hitting a record low.

Their move comes amid speculation that Michael Bungey, the Cordiant chief executive, will attempt to head off a shareholder revolt by appointing David Hearn, the head of the Cordiant-owned Bates network, as his chief operating officer.

Herro, a portfolio manager at Harris Associates, which owns 9.29 per cent of Cordiant, confirmed he was talking to Treger and Myerson but insisted he was not planning to replicate the 1995 coup at Saatchi & Saatchi.

"I agree with Active Value that there are issues that need to be addressed, he said.

Cordiant is reeling from a string of account losses including Hyundai and Wendy's International, the burger chain that was its final major US account.

Analysts at Credit Suisse First Boston say investors are right to be worried about Cordiant, which faces grim short-term trading prospects and is less attractive than either Grey Global or Aegis to prospective bidders.

Cordiant's management team has urged Treger and Myerson to stop destabilising the group.

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