Interpublic's acquisition of True North is still to be approved by
shareholders and there are other options still to be considered, but the
possibility of a merger between Weber Shandwick Worldwide (WSW) and BSMG
is a mouth-watering prospect.
Forget the fact that it creates the first dollars 500 million PR agency
(dollars 534 million, actually). This merger makes better strategic
sense than the original merger of Weber and Shandwick. That original
merger did nothing to address the critical absence of a New York or
Chicago base for WSW.
It did not advance its weak position in healthcare, investor relations
and consumer. And while the overlap helped Golin/Harris, notably in its
public affairs offering, the friction between these old foes, especially
in hi-tech, has been plain to see.
Compare that with the fit between Weber Shandwick and BSMG. In Chicago,
BSMG has a dollars 40 million practice. In New York, BSMG is a dollars
35 million player.
And BSMG also plugs a gap in Portland, OR, while greatly boosting its
presence in Texas, and giving it No. 1 status in LA. BSMG also brings a
massive investor relations and strong corporate/financial arm to the
party, market-leading strength in consumer (including the "milk
mustache" account, Dunkin Donuts and the No. 1 travel division) and its
fast-growing healthcare business, which would make the combined
operations a top five healthcare player.
The merger has obvious attractions for BSMG as well. Despite a strong
consumer arm, it lacks the celebrity/Hollywood connections of WSW. It's
strong in public affairs and issues advocacy advertising, but has no
lobbying operations and only a small presence in London and
It's no slouch in hi-tech, but not a major player either. And it has no
outposts in Minnesota and Seattle. Best of all, what BSMG has lacked
most (and has been attempting to build) is a true global network. It
could also benefit from WSW's investment in technology.
What's more, client conflicts appear to be very few. In fact, the two
agencies actually share some clients (HP, TMP Worldwide, Microsoft.)
As with all issues, the challenge is to make the whole greater than the
sum of its parts. And, of course, there are bound to be huge issues
involved in making such a merger come together, with political friction,
uncertainty, branding confusion, cultural issues and some overlap to
But with no shortage of political friction, uncertainty, branding
confusion, cultural issues and overlap still to overcome at Weber
Shandwick itself, it's arguable that further merging BSMG into the
operations won't make it any worse. In fact, potentially, the injection
of BSMG management could make it a whole lot better. With wholesale
resignations (and firings) of Shandwick senior management either prior
to or following the WSW merger, and the imminent departure of CEO Larry
Weber's right-hand woman, president and COO Marijean Lauzier - not to
mention his own high-flying role within IPG - Weber has a lack of strong
management to call on.
BSMG brings strong management in many areas. And in BSMG CEO Harris
Diamond, Weber would have possibly the best young CEO in the PR game. If
anyone can make it work, Diamond can.
He's smart, likeable, a great leader, and he relishes the detail as much
as Weber dismisses it. It could be a marriage made in heaven.