NEW YORK: Financial communications professionals say they are keeping busy as the Wall Street tumult, which began several weeks ago with the demise of Lehman Brothers and sale of Merrill Lynch to Bank of America, continues.
Stanton Crenshaw is working with Bain Capital Partners and Abernathy is assisting Hellman & Friedman while the two acquire Lehman's Neuberger Berman business and the fixed income and certain alternative asset management businesses of Lehman's investment management division.
“M&A work is still important,” said Alex Stanton, CEO of Stanton Crenshaw. “The financial markets are creating challenges for some, opportunity for others, and uncertainty for all.”
An Abernathy spokesperson, who declined to be named, said that in addition to working with Hellman, the agency also helped longtime client Washington Mutual with its recent acquisition by JPMorgan Chase; Wachovia in its deal with Citigroup; and Barclays in acquiring Lehman Brothers' North American investment banking arm.
Joele Frank, managing partner at Joele Frank, Wilkinson Brimmer Katcher, is also seeing continued M&A work, and believes it will persist.
“The M&A market for us is fine right now; we're seeing an uptick in hostiles,” she said via e-mail. “We think the market and credit situation may weaken smaller players across industries, leading as well to increased deal activity in the short term. Longer-term, there may be a period where sellers need to adjust to new valuation paradigms, but we would expect once that settles, then there will be continued M&A activity.”
Jeff Taufield, Kekst & Co. senior partner, added via e-mail, that despite the “worst credit crisis since the Great Depression, many companies see extraordinary opportunities to acquire prized assets at attractive values.”
Many financial PR professionals who have spoken to PRWeek recently said that it's still too soon to determine what will happen – across the board – in financial communications.
“We will have to wait and see the impact of the government's rescue package, the elections, as well as how deep and long the economic downturn lasts, to assess any effect on the transaction business,” Taufield added.
Outside the M&A arena, financial firms say the work runs the gamut, covering everything from internal communications to reputation management.
“People are more concerned about short-term issues,” said Stanton. “Part of what clients are focusing on is how [to] leverage internal communications to keep their focus on serving clients and keep [staffers] motivated. All the things we currently do, we'll keep doing, but there will be more emphasis on reputation work and internal communications help as [clients] try to provide assurances for their employees.”
Banks, too, are working to reassure customers their money is safe following the M&As. JPMorgan Chase, which acquired WaMu in a deal that marked the largest bank failure in history, made that message a top communications goal.
“The immediate communications priority for JPMorgan Chase and WaMu was achieved [the weekend of September 27 and last week],” Tom Kelly, SVP of regional and retail media relations for JPMorgan Chase, told PRWeek. “[It] was to make sure customers understand their money and deposits are safe and secure.”
He noted that the company is emphasizing that customers have joined “a bigger, stronger bank, a bank that has $2 trillion in assets.”
Citigroup, which recently acquired Wachovia, is also working to reassure consumers, according to Tami Gross-McCarthy, CEO at TMG Public Relations, AOR for Citi Cards and Citibank.
“Citi... is launching various initiatives and programs to help restore confidence and let people know their money and relationship is in tact,” she said. “Everything we're doing today is built around that.”
* Wells Fargo bid on Wachovia after this story went to press.