LONDON: Forgoing the more traditional practice of selling an agency to a larger company, UK independent firm Lexis Public Relations' founders Bill Jones and Tim Adams have been bought out by five of the agency's directors in a deal worth close to $7.2 million (?5 million).The buyout group, headed by managing director Hugh Birley, sealed the deal on April 12. The group came together after Jones expressed a desire to sell the agency last year.
The buyout was advised on by former Lexis non-executive chairman and Text 100 founder Mark Adams.
According to Jones, the sale to the company's directors was preferable to offers made by other major marketing groups.
The move was financed through investment from the five directors themselves, as well as by creative-service-sector business accelerator Pembridge Partnership. Pembridge will take a 10% equity stake in Lexis as a result of its investment.
Birley said both sides considered a management buyout preferable to selling Lexis to a larger agency or holding company. "Eighteen months into most acquisitions, what's left is quite different from what is acquired, and becomes subsumed into the parent brand,
Jones - who is understood to have held discussions with Omnicom before pressing ahead with the management buyout - admitted that avoiding a "three- to five-year
earnout had favored the MBO.