These are tough times for financial PR agencies. The hostile bids
and IPOs that provide some of the most lucrative work have all but dried
up and even the less high-profile agreed deals have slowed to a
trickle.
However, PRWeek's first ever ranking of financial PR agencies working on
UK-related deals shows that there remains room for new outfits to
prosper despite the difficult environment. This analysis is based on
PRWeek's main ranking (below), compiled by Zephus Corporate Finance,
which judges companies on deal value alone. To qualify for inclusion in
this table all deals had to be completed between 1 January 2001 and 30
September 2001, with either bidder, vendor or target being UK-based. The
types of deal include mergers, acquisitions, IPOs, MBOs, MBIs and
IBOs.
In the number one spot is Brunswick, which achieved a deal value of
£66bn. The M&A specialist worked on 86 UK-related deals in the
first nine months of the year, attaining an average deal value of £767.97m.
Its figures were boosted by its advice on one of the most valuable deals
of the year, the £13.15bn acquisition of De Beers by the DBI
Investments consortium. It also worked with Abbey National in its
defence against the now lapsed bid from Lloyds TSB, and on a number of
deals relating to BT playing down its debt, most well known of which was
the Yell buy-out. Brunswick's deal value was almost double the amount of
its nearest rival and number two in the PRWeek rankings Citigate Dewe
Rogerson who came in with £35bn. Despite this, the latter does
lead in the value of IPO work undertaken this year (see table opposite,
top right).
Following closely was Financial Dynamics at £243.2m, which attains
its number three ranking due to pure strength of deal flow. Despite
Brunswick's untroubled position at number one, when the average deal
value is calculated two other agencies in the top ten actually
outperformed Alan Parker's group during the period.
Smithfield Financial advised on just 24 deals worth a total of more than
£31bn, giving it an average deal value of more than £1.3bn.
Its figures were significantly boosted by its advisory role for De Beers
during the DBI takeover and for Billiton during its £6.7bn
acquisition by BHP.
Tavistock Communications has also been a high-value deal adviser, an
average of £878m, and is rewarded with the number five position in
the overall rankings. Its lofty position belies the fact that just over
three quarters of its deal value is provided by just one client -
Vodafone. Tavistock's link with the UK's largest company makes it the
top ranking financial PR adviser for the telecommunications industry
based on deal value.
Gavin Anderson also does well due to its work in the telecommunications
sector; however, its placement at number six in the rankings has to be
qualified. It attained a total deal value of £20.4bn during the
period, although £13.3bn of this emanated from advising on just
four deals in that sector.
Why then should this be an issue? Three of them related to advice for
Vodafone in Japanese-based transactions, with a good chunk of the work
managed out of the agency's Tokyo office. Take these out of the equation
and Gavin Anderson slips down the overall rankings by a couple of
places.
It is, though, buoyed by a strong performance in the banking, insurance
and financial services sector, with advisory roles for Scottish
Provident in its takeover by Abbey National and Gartmore Investment
Management in the State Street deal.
At number 10 Tulchan Communications has beaten many of its more
established rivals. Not bad for an agency that is still less than 18
months old. Formed in May 2000 by ex-Brunswick partner Andrew Grant,
Tulchan has advised on a number of high-profile deals in the first
three-quarters of the year, including the Woolworths demerger from
Kingfisher and the Tempus/ WPP contretemps.
Grant acknowledges it cannot yet match the larger agencies in terms of
number of deals. In fact, he and his colleagues worked on 13 compared
to, say, 143 for Financial Dynamics, 'but,' as he points out, one of the
joys of having a small market share is that 'all you can do is grow it
further.' The Tulchan tactic of working on the higher profile deals
gives it a stronger average deal value, at £297.1m, than several
others in the top ten.
Talk to the heads of financial PR agencies and they acknowledge that
deals have begun to dry up this year, with the trend becoming more
marked since 11 September. 'Things have stalled,' says Angus Maitland,
The Maitland Consultancy founder and chairman. 'Decisions have been
pushed back and we will all be fighting over a restricted deal flow in
the coming months.'
That trend is reflected in the figures. The first nine months of last
year saw 4,314 deals that would qualify for these rankings, worth a
total of £528.94bn. This year that has dropped to 3,729 deals
worth £268.35bn.
That being said, last year's Vodafone/Mannesmann deal alone was worth
£125.7bn, so 2000 was always going to be difficult to beat.
Financial PR agencies will probably be more worried that 110 IPOs in the
first three-quarters of 2001 are less than half the 228 recorded in the
same period last year. More positively, with some big listings around,
such as Friends Provident, the value of this year's deals at £10.97bn actually outstrips the £9.02bn recorded last year.
There is also some good news for those agencies with venture capitalist
clients. The number of VC deals held relatively steady this year
compared to the same period last year, while actually increasing in
value from £25.38bn to £26.53bn.
Financial Dynamics gains most of its high ranking positions across the
various tables by its sheer number of deals and its VC work is no
exception: 23 deals compared to just four for second-ranked Smithfield
Financial.
However, much of its deal value in this sector can be attributed to its
work on larger transactions for CinVen.
Tim Jackaman, chairman of the newly merged Weber Shandwick Square Mile,
is optimistic that there will be some growth in international M&A work
early next year, but remains sceptical as to whether IPOs will return
quite so quickly, even if the market bounces back. He hopes his newly
combined agency will have a stronger outlook than the numbers 20 and 21
achieved this time round by Weber Shandwick Worldwide and Square Mile,
respectively.
With Kekst & Co making its number 13 appearance in the rankings largely
on the back of its work for the American institutions on the Yell deal,
and Biss Lancaster attaining the number 18 position solely for advising
Wanadoo on the Freeserve acquisition, next year should offer
opportunities for several agencies to jump up the rankings.
THE TOP 25 FINANCIAL PR FIRMS 2001
Rank Adviser Number of Total deal value
deals (pounds ms)
1 Brunswick 86 66,045.44
2 Citigate Dewe Rogerson 93 35,623.57
3 Financial Dynamics 143 34,780.00
4 Smithfield Financial 24 31,595.71
5 Tavistock Communications 31 27,238.40
6 Gavin Anderson & Company 33 20,483.06
7 Finsbury 34 15,806.11
8 Maitland Consultancy 44 6,369.12
9 Hudson Sandler 30 4,373.82
10 Tulchan Communications 13 3,862.30
11 Bell Pottinger Financial 22 3,554.50
12 Merlin Financial Communications 41 3,295.88
13 Kekst and Company 2 3,159.76
14 Penrose Financial 29 2,954.23
15 Cardew & Co 19 2,947.82
16 College Hill Associates 87 1,970.21
17 Hogarth Partnership 20 1,744.29
18 Biss Lancaster 1 1,647.83
19 Buchanan Communications 102 1,218.39
20 Weber Shandwick Worldwide 19 1,084.75
21 Square Mile BSMG Worldwide 56 1,003.82
22 Bankside Consultants 13 981.07
23 Holborn Public Relations 25 819.50
24 GCI Financial Group 23 815.09
25 Grandfield Communications 9 547.91
Agencies ranked by deal value. Criteria: 1 Announced or completed
between 1 January 2001 to 30 September 2001 2 Either bidder, target or
vendor is UK-based 3 Deal types include mergers, acquisitions, IPOs,
MBOs, MBIs and IBOs
TOP 25 FINANCIAL PR FIRMS BY NUMBER OF DEALS
Rank Adviser Number of Total deal value
deals (pounds ms)
1 Financial Dynamics 143 34,780.00
2 Buchanan Communications 102 1,218.39
3 Citigate Dewe Rogerson 93 35,623.57
4 College Hill Associates 87 1,970.21
5 Brunswick 86 66,045.44
6 Square Mile BSMG Worldwide 56 1,003.82
7 The Maitland Consultancy 44 6,369.12
8 Merlin Financial Communications 41 3,295.88
9 Finsbury 34 15,806.11
10 Gavin Anderson & Company 33 20,483.06
11 Tavistock Communications 31 27,238.40
12 Hudson Sandler 30 4,373.82
13 Penrose Financial 29 2,954.23
14 Binns & Co Public Relations 28 234.68
15 Holborn Public Relations 25 819.5
16 Smithfield Financial 24 31,595.71
17 GCI Financial Group 23 815.09
18 Bell Pottinger Financial 22 3,554.50
19 Hogarth Partnership 20 1,744.29
20 Cardew & Co 19 2,947.82
21 Weber Shandwick Worldwide 19 1,084.75
22 Golin/Harris Ludgate 14 187.85
23 Tulchan Communications 13 3,862.30
24 Bankside Consultants 13 981.07
25 Millham Communications 12 59.28
Criteria: 1 Announced or completed between 1 January 2001-30 September
2001 2 Either bidder, target or vendor is UK-based 3 Deal types include
mergers, acquisitions, IPOs, MBOs, MBIs and IBOs
TOP 10 FINANCIAL PR FIRMS ACTING ON VC DEALS
Rank Adviser Number of Total deal value
deals (pounds ms)
1 Financial Dynamics 23 8,099.69
2 Smithfield Financial 4 3,649.59
3 Penrose Financial 21 2,472.09
4 Brunswick 5 2,307.66
5 Hudson Sandler 5 2,174.02
6 Gavin Anderson & Company 5 2,156.88
7 Kekst and Company 1 2,137.73
8 Hogarth Partnership 3 1,088.63
9 Bankside Consultants 2 918.58
10 Citigate Dewe Rogerson 11 910.73
Criteria: 1 Announced or completed between 1 January 2001-30 September
2001 2 Either bidder, target or vendor is UK-based 3 Deal types include
mergers, acquisitions, IPOs, MBOs, MBIs, IBOs
TOP 10 FINANCIAL PR FIRMS ACTING ON IPOS
Rank Adviser Number of Total deal value
deals (pounds ms)
1 Citigate Dewe Rogerson 2 6,588.68
2 Bell Pottinger Financial 2 2,000.54
3 Financial Dynamics 6 1,266.68
4 Grandfield Communications 1 322.51
5 Buchanan Communications 10 47.82
6 Tulchan Communications 2 41.63
7 Square Mile BSMG Worldwide 6 29.43
8 College Hill Associates 6 21
9 Redleaf Communications 1 18.48
10 Bankside Consultants 1 7.99
Criteria: 1 Announced or completed between 1 January 2001-30 September
2001 2 Either bidder, target or vendor is UK-based 3 Deal types include
mergers, acquisitions, IPOs, MBOs, MBIs, IBOs
HOSTILE BIDS INVOLVING UK COMPANIES IN 2001
Announce Target Target's Bidder Bidder's financial
Date financial PR PR
31/1/01 Abbey National Bell Pottinger Lloyds TSB Finsbury in
Financial, Grp conjunction with
Brunswick Citigate Dewe
Rogerson
26/4/01 Barrett
Resources In-house Royal Dutch/ In-house PR
Shell Group
4/6/01 Wolverhampton
& Dudley Hudson Sandler Silverhoney Bell Pottinger
Breweries Financial
15/1/01 Bryant Group Financial Taylor Citigate Dewe
Dynamics Woodrow Rogerson
20/8/01 Tempus Group Tulchan Comms WPP Group Buchanan
Communications
4/7/01 Asda
Property
Holdings Finsbury BL Davidson City Profile Group
7/4/01 Groucho Club None used Zoo Hotels None used
14/3/01 H Young Weber Lakefield None used
Holdings Shandwick Hldng
W'wide
27/6/01 Claims Direct Golin/Harris Barker Binns & Co PR
Ludgate Securities
7/6/01 Tay Homes Rawlings Country & Buchanan
Financial PR Metro Grp Communications
15/8/01 TBI Buchanan Vinci SA Financial Dynamics
Communi-
cations
Announce Value Outcome
Date (pounds
ms)
31/1/01 19,770 The offer lapsed following referral to the Competition
Commission
26/4/01 1,655 The offer failed following a white knight bid from
Williams Companies
4/6/01 997 The offer failled following lack of acceptances from
Wolverhampton shareholders
15/1/01 522 The offer was successful after Taylor Woodrow
increased its original offer
20/8/01 385 The offer became recommended following the withdrawal
of Havas. The outcome is still pending
4/7/01 231.7 The offer was successful following Asda Property
board's decision to reverse their earlier position and
accept the offer
7/4/01 16 The offer failed following rejection by Groucho Club
shareholders
14/3/01 14.3 The offer was successful following the Lakefield's
board decision to reverse their earlier position and
accept the offer
27/6/01 11.1 The offer was successful following the Claims Direct
board's decision to reverse their earlier position and
accept the offer
7/6/01 N/A The offer was never formally launched, although the
indicative offer by C&M led to a bitter war of words
between the two parties
15/8/01 425.5 TBI launched a hostile offer for Vinci, despite the
bid being later recommended by the TBI board. The
offer lapsed due to a lack of sufficient acceptance
level by TBI shareholders
