WASHINGTON, DC: With 1999 on track to smash 1998’s record number of mergers and acquisitions, the term ’privately held PR firm’ is on the way to becoming an oxymoron.
WASHINGTON, DC: With 1999 on track to smash 1998’s record number of
mergers and acquisitions, the term ’privately held PR firm’ is on the
way to becoming an oxymoron.
This torrid pace was the most notable finding of the Council of PR
Firms’ Report on Mergers and Acquisitions in the Public Relations
Industry, released last week. (Previewed in PRWeek, June 14).
President Jack Bergen said he expects M&A activity to continue at this
pace and pointed toward overseas groups such as Publicis, Incepta Group
and Havas as likely buyers. He also noted that acquisition-minded
agencies are especially keen on finding specialty practices in hi-tech,
healthcare and government affairs.
According to the study, sellers have historically been motivated by
opportunities to increase profits, financial security and career
benefits. Today, sellers are less concerned with exit strategy than with
retaining and expanding their leadership role in the company.
Rick Gould, CEO of Gould Eisele Crombie and an author of the report,
said some failed acquisitions were due to sellers’ unmet expectations
and their perceived position in the firm.
’(Acquired CEOs) found out that, post-acquisition, they became just
another employee,’ he said.