EDITORIAL: Pros and pitfalls of PR flotations

When Text 100 Group joins the London Stock Exchange (LSE) - its flotation is expected next month - it will be the first pure PR business to list on the main market since Citigate reversed into Incepta in 1996.

When Text 100 Group joins the London Stock Exchange (LSE) - its

flotation is expected next month - it will be the first pure PR business

to list on the main market since Citigate reversed into Incepta in

1996.



The experience of PR agencies listed on the LSE has not always been a

happy one. During its last years as a public company, Shandwick’s

directors were subjected to a concerted campaign by one of its

shareholders to improve its share price by changing its management.



Valin Pollen, one of the most successful agencies of the 1980s, saw its

share price collapse after it acquired the New York agency the Carter

Organisation, whose founder went to prison after being caught defrauding

his own company. Good Relations suffered when one of its directors was

involved in a share scandal.



The only truly shining examples of happily quoted PR companies are

Incepta and Paragon, which listed in the 1980s and was later bought by

Shandwick.



The experience of mixed PR and advertising groups has been better. Lord

Bell’s Chime Communications saw its share price leap when it widened its

offering with the acquisition of ad agency HHCL in 1997, and WPP is in

the FTSE 100.



Until now, Text 100 Group has grown organically and not through

acquisition, and chairman Tom Lewis has no plans to use the cash raised

on the LSE to go shopping. One of his main reasons for wanting to join

the LSE is to increase the standing of his business with its clients. If

all goes well, Text 100’s listing will hopefully attract other agencies

to the LSE.



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