Well, what do we know? I was just sitting down to write a piece
congratulating the Interpublic Group on tearing down the walls of
conflict by acquiring MacManus, when those pesky Leo Burnetters steal
the prize from under Phil Geier’s nose. Of course, at around dollars 1
billion it’s not such a steal, and Leo Burnett would probably not be
able to do this without Dentsu’s extraordinary financial resources, but
it’s a seller’s market.
So now we’ll never know if Procter & Gamble and Unilever had okayed
IPG’s takeover of MacManus (apparently so) or if Mars would be
sacrificed for Nestle (not clear). Instead, we have that rare
advertising event; an eminently sensible deal, with no immediate obvious
flaws regarding long-term future, client clashes or key personnel.
Unexpectedly, we now have a fourth mega holding company, temporarily
known as BDM, which is fascinating, both for the rationale behind each
party’s decision and for BDM’s innate potential.
MacManus was for sale. As a private company it could no longer compete
globally at the top level. It was both buoyed and restricted by being a
P&G agency - that is, until Cincinnati’s apparent change of heart on
conflict. The IPG idea was, initially, unlikely, but was getting
The greater logic of a deal with Burnett was lost in the fallout of the
failed media merger.
Leo Burnett was no less pained by that failure. Its stake in BBH was
interesting (partly because a P&G agency bought a Unilever agency), but
small beer on the global stage. Dentsu’s 20 per cent stake in Burnett
was likely to be more significant, because it allowed the latter a
mid-term independent future as it bought up below the line and media
operations globally. But there was, inevitably, growing alarm at
remaining an independent private network in an increasingly vicious
And Dentsu? When I first became a marketing journalist there was an
organisation called HDM (Havas Dentsu Marsteller), an earlier attempt at
a global three-way partnership. It failed, of course, partly because the
western partners were not strong enough, but largely because back then
Dentsu also lacked the will - even the incentive - to crack the world.
Since then, the HDM break-up, the unsuccessful CDP purchase, the
globalisation of Japanese business, the first domestic Japanese account
moves and the Asian financial crisis have changed Dentsu’s world. It was
already planning to float in 2001. Now, locked in to this new
partnership, Dentsu may, at last, unleash its full potential beyond
And so will BDM when it floats as a combined entity in 2001. This
apparent win-win deal creates a genuine challenger to the advertising
big three. Not, of course, that the big three will take BDM lying down.
There will be an almighty global acquisition scramble that will make the
events of the past week appear tame.