THE AGENCY BUSINESS: Midsize firms, boutiques still dominant in 2003 M&A tables

The usual cast of characters receive listing as the seven agencies with the most M&A PR activity in the 2003 league tables published by the Corporate Control Alert.

The usual cast of characters receive listing as the seven agencies with the most M&A PR activity in the 2003 league tables published by the Corporate Control Alert.

There is no clubbier segment of the PR industry than the handful of agencies that dominate the world of M&A PR. Unlike other niche PR markets (e.g. public affairs and tech PR), which the industry's giants have managed to penetrate successfully by both acquisition and practice-building, a thriving corporate M&A practice continues to elude the world's giant PR firms. This is attributable to the fact that the vast majority of M&A PR business comes to firms via referrals from the investment banks and corporate lawyers that are working on the deals. In essence, this niche is defined by these firms' close relationships with the financial world's deal-makers. PR pros that successfully cultivate such relationships, which then translate into a steady stream of high-margin business, have little incentive to work for anyone else. Therefore, the M&A niche remains dominated by boutiques and midsize firms. The PR M&A oligopoly was once again on display a few weeks ago when The Deal's sister publication, Corporate Control Alert, published its annual M&A league table for 2003. The table ranks M&A advisers - including investment bankers, proxy solicitors, and PR firms - by the number of M&A deals they participated in during the year. For the most part, the table is about bragging rights, yet it does provide something of an industry barometer. It also should come as no great shock that the table is littered with the names of the market's usual suspects. Here's a rundown of the list: 1. Kekst & Co. It's hard to say anything new about Kekst. It long ago established itself as the New York Yankees of M&A PR. The 2003 results show no signs that this will change any time soon. The shop worked on 55 deals last year. That's just three fewer than double its nearest competitor. 2. Abernathy MacGregor Group. Abernathy found itself back near the top in 2003. It can be argued that placing behind Kekst is really winning the race for second. After a lackluster 2002, which saw Abernathy place fourth with just eight deals, the firm has come roaring back with 29 deals in 2003. 3. Joele Frank, Wilkinson Brimmer Katcher. This firm continues to be a force in the M&A world just three years removed from its founding by former Abernathy partner Joele Frank. It worked on 21 deals during the year, which is six more than in 2002. The shop's high-profile assignments included helping PeopleSoft defend itself against Oracle's hostile bid, as well as the year's most public proxy fight, energy company El Paso. 4. Financial Dynamics. FD, a UK-based shop with a European track record in M&A PR, makes an appearance on the US league tables with 20 deals in 2003. Nevertheless, several of the company's deals appear to be clients based in the UK that were somehow involved in US deals last year. And it should be acknowledged that the league tables have a rather liberal definition of what constitutes a US deal. However, the firm's new US CEO, Declan Kelly, has shown that he's serious about building a strong US-based agency using its UK-reputation as a springboard - in much the same way that Brunswick has. Those who are familiar with his career track record might find it hard to bet against him. 5. Brunswick Group. Another strong UK name that has grown its US profile in recent years with the addition of former Wall Street Journal scribe Steve Lipin. The firm posted 20 deals in 2003, with some still obviously better classified as global (or even European) transactions. Nevertheless, the jump from last year's six deals is impressive. 6. Citigate Sard Verbinnen. Usually considered among the M&A elite, Sard Verbinnen's ranking fell a bit in 2003, as it registered 13 deals. Yet, since it's mostly a US focused shop, it doesn't have the luxury of padding its numbers with overseas work that's handled by offshore offices. Last year, it also worked on some multibillion-dollar blue-chip deals, including Sears Roebuck's sale of its credit-card unit and Time Warner's sale of its music unit. 7. Burson-Marsteller. Burson registers as the highest-ranking multinational giant on the 2003 table. Burson posted a respectable 13 deals. However, its deals tended to be much smaller in size and profile than the specialty firms. ------- 2003 league table The following lists the seven agencies with the most M&A activity last year and how many deals they worked on: 1. Kekst & Co. - 55 2. Abernathy MacGregor - 29 3. Joele Frank, Wilkinson Brimmer Katcher - 21 4. Financial Dynamics - 20 5. Brunswick Group - 20 6. Burson-Marsteller - 13 7. Citigate Sard Verbinnen - 13 Source: Corporate Control Alert

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