Charles Barker - one of the best known brands in the PR business -
has been bought by US PR group Bozell Sawyer Miller. The two companies had
been in talks since December.
The deal, which was completed last Friday, values Charles Barker at over
pounds 10.5 million. Its fee income last year was pounds 6.32 million,
with pre-tax profits of pounds 1.03 million.
The consultancy, the 11th biggest in the UK, will keep the Charles Barker
name. Chief executive Tim Sutton will continue in the same role, and Nan
Williams has been promoted to managing director.
The deal is the latest in a rush of purchases by ad agency groups and
their PR arms in recent months. BSM, owned by US ad agency group Bozell,
Jacobs, Kenyon and Eckhardt, is a major player in the US but relatively
unknown in Europe.
The deal gives the group a combined income of dollars 71 million and 600
staff, and establishes a bridgehead for the company in London and
Importantly, the deal also exploits their shared strengths in key areas
like corporate and public affairs, consumer marketing, and healthcare.
BSM chairman and CEO Harris Diamond said they had willingly paid ’a
premium’ to buy Charles Barker. ’We have invested in a pedigree business
with a pedigree brand,’ said Diamond. ’The company’s track record over the
last five years is outstanding.’
Charles Barker was wooed by a number of other suitors before signing with
BSM. ’We could have gone with a bigger group but not with one whose
business fitted so well with ours,’ said Sutton.
The two companies have already collaborated on several assignments, and
Charles Barker can expect further referrals from the US PR firm and its
sister ad agencies, including Delaney Fletcher Bozell in the UK.
With just under 50 per cent of the shares between them, the five main
shareholder directors - Sutton, Angela Heylin, Steve Gebbett, Evie Soames
and Jennifer Potter - all stand to gain up to the equivalent of pounds 1
million in the deal. Investment firm Ormonde held a 45 per cent stake, and
the rest was owned by other directors and staff.
Although there is no earn-out period, there will be an element of deferral
partly linked to future performance. Most of the senior directors have
signed long-term contracts.
The sale is bound to stir memories of the company’s controversial founding
in 1992 in an MBO from its collapsed former parent Corporate
At the time it prompted outrage among campaigners urging a clamp down on
the ’phoenixing’ of collapsed companies. But an IPR investigation later
exonerated Heylin, who was the only former director of Corporate
Communications to join the MBO team, from any wrongdoing.
Sutton robustly defended the company’s position. ’We make no apology for
investing in this business, and we would not have done anything
differently,’ he said. ’Those that have got nothing better to do than talk
about that should get a life and get an agency.’
BSM has five operating units: strategic communications firm Sawyer Miller
Consulting; PR and marketing firm Bozell PR; KRC Research; advocacy
advertising firm Bozell/Eskew; and grassroots mobilisation specialist
Strategic Alliances Group.