CAMPAIGNS: Glas Cymru bond beats all the odds - Financial PR

Client: Glas Cymru
PR Team: Bell Pottinger Good Relations
Campaign: Selling 'Not-for-Profit' to the City
Timescale: November 2000 - December 2001
Budget: £175,000

In November 2000, Welsh Water was up for sale. The company had serious debts following some poor investments by a previous management, but still attracted interest from a number of parties. Among those was Glas Cymru, a not-for-profit company set up with former permanent secretary at the Treasury Lord Burns as its chairman. Glas Cymru's idea was to issue bonds to buy the company and then run it without interference from shareholders to provide the cheapest water services possible.

The campaign to do this won this year's Institute of Public Relations Excellence Award in the Corporate and Financial category.

Glas Cymru had agreed a deal with the owners of Welsh Water, WPD, but it had to be approved by the water industry regulator, Philip Fletcher.

Before reaching a judgement, Fletcher held a three-month consultation period.

Once the regulator had given the go-ahead, the firm then needed to raise the £2bn required with the largest ever sterling bond issue. This meant persuading institutional investors to buy bonds which would give them a safe investment, but at a lower rate of return than shares.

Glas Cymru asked Bell Pottinger Good Relations to provide financial and corporate PR around the whole process.


To make the bid successful. This meant first getting approval from the regulator, and then getting the required investment from the City. Behind these main objectives, however, were a number of secondary objectives that would all help towards the overall aim. These included gaining the support of local people, politicians, and the water industry for what was regarded as a radical idea.

Although WPD had approved the Glas Cymru bid, there were still others who wanted to make counter bids. These had to be defeated in order for the not-for-profit idea to be adopted.

Strategy and plan

Good Relations' central idea was to form an 'alignment of interests' between Glas Cymru and the various target audiences. In the City, this was achieved through one-to-one briefings with key analysts.

This was necessary in order to demonstrate that the firm was robust and to explain that there would be no risky diversification away from core activities.

To achieve this alignment of interests with politicians and the water industry the bid was presented as a 'Welsh solution for Welsh people'.

This reduced the risk that the bid would be seen as setting a precedent for the industry - something that could have jeopardised its acceptance as the Treasury, among other parties, was disapproving of deviation from a shareholder model.

Positioning the company in this way also helped win the support of local people, along with the promise of lower prices.

In terms of defeating the rival bid, the strategy was to look supremely confident from the start in the hope that they would back off.

This was achieved with some well-positioned media coverage in The Financial Times and on the BBC Radio 4 Today programme.

All of the above created a groundswell of support that helped embolden the regulator to approve a potentially risky new plan. To help further, the agency provided regular research as to what various opinion-leaders (City analysts, ministers, customers', etc) thought of the plan.

Measurement and Evaluation

The story was well covered by the national press with more than 84 million people being reached through 56 pieces of coverage.

These included three positive comments in the FT's Lex column, which was targeted as a potentially key supporter of the bid. There were also features on Newsnight, Channel 4 News and Today.

Within the specialist press, the story was given front page coverage on Utility Week and was also covered extensively in the financial press and the Welsh press.


Ultimately, the success of the campaign was that Glas Cymru secured regulatory approval. The £2bn bond issue was also over-subscribed by 30 per cent.

With the first annual results last month, Glas Cymru also proved that the messaging had been on target.

The performance reported put the new company on target to deliver £23m back to customers in terms of lower bills over the next two years. Even the originally sceptical media (The Sunday Telegraph called Glas Cymru a 'pantomime horse') accepted that the idea was a success.

The campaign was handled by the political communications team at the agency and the strategy adopted clearly reflects that. The skillful way the project was positioned to win approval, gained great support among key audiences.

As the FT's Lex Column said (9 April 2001): 'They said it couldn't be done. Glas Cymru, however is coming to market with £2bn bonds.'

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