CAMPAIGNS: FLOTATION; DR paints a bright future for Orange

Client: Hutchison Telecom PR Team: Dewe Rogerson Campaign: Flotation of Orange digital mobile phone network Timescale: September 1995 - March 1996 Cost: Approx pounds 500,000

Client: Hutchison Telecom

PR Team: Dewe Rogerson

Campaign: Flotation of Orange digital mobile phone network

Timescale: September 1995 - March 1996

Cost: Approx pounds 500,000



When Orange was first launched in April 1994, it was perceived as a

‘lemon’ in an overcrowded and competitive telecomms market. But it

quickly became a powerful brand and put a serious squeeze on market

leaders Cellnet and Vodafone.



Easy-to-understand tariffs and innovative marketing has attracted over

half a million subscribers in just over two years.



Just a year after its launch, banks were approaching Hutchison

suggesting flotation, but while the service had a strong profile among

consumer journalists, few corporate or financial correspondents were

aware of its business pedigree. This was the challenge Hutchison faced

when it decided to float in September 1995.



Objective



To ensure the flotation was a success through establishing positive

perceptions of Orange’s management and prospects; optimising opinion

former endorsement and retail demand; and developing investor relations.



Tactics



Dewe Rogerson was appointed in September following an embarrassing leak

of Orange’s intentions by a competitor on the PR pitch list.



DR used the interest generated as momentum for an autumn market

education programme. This included background briefings, facility visits

and product trials for financial and telecoms journalists in the UK and

abroad. A communication programme for analysts was accompanied by

interviews between leading financial commentators and Orange’s senior

management.



DR also convinced its client to float as Orange, rather than Hutchison

Telecommunications UK plc, to harness the growing strength of the brand.



Gradual profile-building was boosted in December when Orange completed a

pounds 1.2 billion credit facility. DR publicised this to demonstrate

that major banks viewed Orange as a serious company.



The intention to float announcement was made in January 1996. DR

designed, produced and distributed a mailing to all Orange subscribers

offering the chance to become part-owners. This was a means of boosting

demand in a company whose product was not widely known in the City.



At the end of February the prospectus was launched and DR began a three-

week road show for potential large-scale investors in the UK, Far East,

Europe and North America. The end of March saw the announcement of price

and allocation details and shares started trading.



Results



Dewe Rogerson achieved significant coverage in the run up to the

flotation announcement, exploiting City speculation for three months. A

steady trickle of coverage throughout the autumn culminated in major

profiles in the Sunday Telegraph and the Times in December.



After Christmas there were dozens of press and broadcast interviews

including BBC Business Breakfast, Financial World Tonight and the One

O’Clock News.



The share offer was ten times over-subscribed and 35,000 applied via the

retail offer. Following the flotation, Orange was valued at over pounds

2.5 billion and joined the ranks of the FT-SE 100 index just two months

after it came to market.



Verdict



DR’s work was a key factor in the company’s meteoric rise from market

newcomer to City success, something acknowledged by Orange which has

retained the agency.



Edward Cunning-Bruce, head of corporate stocks at Kleinwort Benson,

said: ‘Dewe Rogerson anticipated the main issues and managed the flow of

communications faultlessly.’



The flotation ran smoothly with no specific above-the-line activity and

despite the fact that Orange’s balance sheet is historically red. The

company will be expected to make a profit by 1998 and this will

determine exactly how bright the future is.



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