The cat was out of the bag well before True North’s faxed
invitation to journalists around the world last Thursday morning to join
a telephone conference call for a ’significant announcement’.
For some weeks the question has been not if the group would merge its
FCB and Bozell networks, but when.
The strategy of separateness to which True North’s former chairman,
Bruce Mason, had clung since the group’s $440 million acquisition of
Bozell two years ago, has survived only four months under his successor,
Indeed, the marriage is a tacit acknowledgment that Maurice Levy, the
Publicis chief who unsuccessfully challenged the initial purchase of
Bozell by True North - his erstwhile international ally - in the US
courts, may have had a point when he argued that separate networks would
not solve the group’s lack of global reach.
’It’s a smart move,’ comments Levy, whose company remains True North’s
largest individual shareholder (Publicis is holding on to the shares
until they reach a decent price). ’True North couldn’t achieve anything
with separate networks. Now it looks more like a seamless
And a more effective one? ’As a shareholder I feel sure this will
improve True North’s standing with the stock market. But as a competitor
I feel it still has a long way to go.’
Levy reflects a widespread view that bringing the two networks together
to form FCB Worldwide, giving it number one status in the US and the
world’s fifth largest network, is not the final chapter in the True
With anticipated savings of almost $25 million from the merger, the
prospect of an improving share price and rising revenues, few doubt True
North will shortly turn predator with Grey, Bates and Saatchi & Saatchi
as its primary targets en route to joining Omnicom, WPP and Interpublic
in the Champions’ League.
Some believe such a move is inevitable if only for True North to justify
its existence. ’If not, why bother having a holding company?’ a former
FCB senior regional manager asks. Bell is certainly keeping the door
’We won’t comment on speculation and rumours,’ he says. ’But I won’t
rule out anything.’
For the time being, though, he has enough to do just bedding down this
merger. For a start, there’s the cathartic period when jobs will have to
be shed. Don Seeley, True North’s chief financial officer, will not say
how many but insists they will come from administration and general
management rather than front-of-house departments such as client
services, new business or creative.
Then there’s the tricky task of melding together a network rife with
inner tension. While the Bozell name is being retained in the US, mainly
to resolve a number of domestic client clashes, particularly Bozell’s
Bank of America and FCB’s Chase Manhattan Bank, Bozell staffers must
come to terms with its disappearance from the international scene.
Moreover, the top jobs have gone to FCB men. Brendan Ryan, currently
FCB’s worldwide chairman, becomes chief executive of the combined agency
while Harry Reid, the London-based international president, oversees the
It may mark the start of a gradual diminishing of the Bozell
Small wonder that the reactions of FCB and Bozell senior staffers from
all over the world taking part in a telephone briefing immediately after
last Wednesday’s True North board meeting in New York were starkly
Even within FCB cohesiveness is hampered by the agency’s split centres
of gravity caused by Ryan’s decision, as worldwide chairman, to decamp
from FCB’s Chicago heartland to New York. The result has been to
separate FCB’s flagship agency from its spiritual home and its biggest
global client, SC Johnson, the domestic cleaning products manufacturer.
’Ryan wanted to pull everything into New York but True North wouldn’t
have it,’ a former senior staffer says.
At the same time, observers point to FCB’s schizophrenic attitude to
planning where Ryan’s scepticism is at odds with the enthusiasm of
managers in the Chicago and San Francisco offices.
But even all this is dwarfed by a fundamental conundrum. Despite all the
investment being poured into building a global network - Europe will be
a heavy focus of attention with up to nine acquisitions in the pipeline,
Reid promises - there is little credible international business with
which to fuel it. Kimberly-Clark, Tambrands and Levi Strauss, all
potential global clients, have been lost recently and replaced with
mainly US domestic accounts.
To make matters worse, millions of pounds worth of FCB car business in
Europe will have to be sacrificed in order to keep the Daimler-Chrysler
account safe at Bozell. And, even after the merger, Germany and Spain
will be the only European markets where FCB worldwide has top ten
Overriding all that, however, is the need to resolve the group’s messy
media offerings which, many believe, is the real driving force behind
the marriage. A series of meetings have taken place in the US - where
the two networks’ media arrangements have never been properly
co-ordinated by their holding company - about how the discipline should
be organised on a global basis.
In Europe the issue has become increasingly pressing. FCB has only a
limited working relationship with Optimedia, its one-time joint venture
with Publicis, and FCB accounts have been drifting into BJK&E, owned
jointly by Bozell and CIA, in which WPP has a stake.
The boldest solution might be a bid for Zenith together with one, or
both, of its parents - Bates and Saatchis. As Ryan says of today’s
consolidating business world: ’Being big isn’t an end in itself - but it