Rift divides St Luke's famed co-operative ownership structure

St Luke's famous co-operative business model is coming under pressure as a serious rift grows among staff over the company's future strategy.

The agency schism centres on divided opinion about opening an overseas office, possibly in New York, and the future of several key directors.

The moves are believed to be opposed by the joint managing directors Phil Teer and Neil Henderson, resulting in a stand-off with Andy Law, St Luke's chairman.

It is also thought Law's involvement in the creative media company Artist Network, of which he is the chief executive, is an issue at the agency.

However, Henderson denied reports that he and Teer would be leaving the agency as a result. "It isn't true. We debate issues in the agency and some get pretty lively," Henderson said.

The co-operative structure of St Luke's means that all staff are co-owners who are involved in all decisions. Agency-wide meetings over the past week have left staff split over key issues.