BPP Communications will be made up of Bell Pottinger Public Relations, Pelham Bell Pottinger (60%), Bell Pottinger Public Affairs, Bell Pottinger Sans Frontières and Bell Pottinger Middle East.
In addition, BPP Communications will acquire the 40% stake in Pelham Bell Pottinger held by senior management.
The new company will be owned by Lord Bell, David Beck, Jeremy Deedes, James Henderson, John Leece, Tom Mollo, David Wilson and certain other executives involved in the management of the Bell Pottinger businesses.
BPP Communications will acquire these non-core businesses for total consideration of £19.6m. This includes £13.9m in cash payable on completion, £1m in cash payable on agreement of the completion balance sheet, the issue of 4.1 million ordinary and 4.1 million preference shares with nominal value of £4.1m and representing 25% of the equity capital of BPP Communications.
Chime has agreed with BPP Communications certain liquidity rights in relation to its equity holding in BPP Communications and has expressed no intention of seeking to sell its holding to date.
Chime’s chief operating officer Mark Smith will sit on the BPP Communications board as a director as part of the deal.
Lord Bell and Piers Pottinger will both resign from the board of Chime and a new non-executive chairman will be appointed in due course.
Christopher Satterthwaite, chief executive officer of Chime Communications, said: ‘The disposal is a natural evolution given the planned repositioning of the group and is a key part of our future growth plan.
‘When completed, the group's growth prospects will be strong with a good acquisition pipeline, including international opportunities already identified and funds available to make these acquisitions.’
Also read: Lord Bell speaks about Bell Pottinger MBO