Leo Burnett has beaten Interpublic in a dramatic race to strike a
deal with MacManus, the holding company of D’Arcy, MediaVest and NW
A merger between the Leo Group and the MacManus Group was announced this
week as the two advertising giants set up a new global holding company,
provisionally named BDM, with the help of an estimated dollars 400
million investment from Dentsu.
Dentsu will take a 20 per cent stake in BDM. The deal will be formalised
in January and the new company will aim to go public within a year.
BDM will be advertising’s fourth biggest holding company, with combined
billings of dollars 14.5 billion (dollars 27.5 billion including
BDM is expected to keep Leo Burnett and D’Arcy as separate entities and
the formation of BDM, which will be based in Chicago, is not expected to
throw up any global client conflict. The Burnett and MacManus Groups,
numbers ten and 11 in the world, share a number of global clients
including Procter & Gamble, Coca-Cola, Pillsbury and Philip Morris.
Roger Haupt, who takes over from Rick Fizdale as chief executive officer
of the Leo Group on 1 January, will become CEO of BDM, while Roy
Bostock, chairman and chief executive of MacManus, will become chairman
of the new holding company. Dentsu will also be represented on the BDM
Haupt said: ’While the Leo Group and the MacManus Group have performed
well as private companies, today’s marketplace demands strongly
capitalised global agencies. A public offering will give us the
resources to expand the company’s business and attract and retain top
Interpublic was known to have been close to a deal with MacManus shortly
before the news broke about BDM.
Bostock said: ’We have carefully evaluated a range of options that would
enable us to better service our global clients. We intend to be the
premier global communications company.’
Full analysis, p2.