FD sale: haven't we been here before?

What made the evening so memorable was a quite brilliant speech by Nick Miles - his long-time colleague, and now at M: Communications - which simply ran through all the occasions on which Knox had sold and bought back his business in the previous 30 years. There was a merger with a consumer agency to give the firm more breadth. There was a merger with another financial PR agency - Brian Basham's Broad Street Associates - to give greater clout across a wider range of financial comms.

There was a merger with a US PR firm on the basis that Knox's agency would become the British and European arm of an international business. There was a merger with advertising agency Cordiant to allow the cross-selling of services. And so on.

All these deals had three things in common. The first was that Knox sold each time for a full price. The second was that the buyers all had some grand but ill-defined strategy. The third was that a few years later, the strategy was abandoned, the business was suffering and Knox was able to buy it back for a low price.

With FD, it is a management consultancy that is signing the eye-watering cheque, and both buyer and seller (principally FD's Charles Watson) are waxing lyrical about how the deal reflects the fact that financial PR has come of age. The vision is that FD's board-level contacts will open the door for the enlarged group to sell other consultancy services.

This, of course, is the same argument that Maurice Saatchi used in the 1980s when he went round the world buying consultancies, eventually making a tilt at Midland Bank, now owned by HSBC. Advertising had come of age and had board-level contacts who would open the doors for other services.

It did not work then but, hey, who remembers the 1980s? This time it is different.
anthony.hilton@haynet.com

Anthony Hilton is City commentator on London's Evening Standard