WPP turns its attention to buying up Buchanan

Communications giant WPP is believed to be poised to acquire City financial PR firm Buchanan Communications in a deal potentially worth up to a maximum of pounds 15 million over five years. Buchanan has acted as WPP’s financial PR consultant for over a decade.

Communications giant WPP is believed to be poised to acquire City

financial PR firm Buchanan Communications in a deal potentially worth up

to a maximum of pounds 15 million over five years. Buchanan has acted as

WPP’s financial PR consultant for over a decade.



The deal, likely to be announced shortly, is understood to include a

down payment of pounds 4 million based on 1996 post-tax profits of about

pounds 600,000 - a multiple of 6.8. The total of up to pounds 15 million

is based on post-tax profits growth of 20 per cent a year. The eight

directors, led by chief executive Richard Oldworth, will have a

five-year earn out period.



Ad agency Abbott Mead Vickers had earlier been tipped to acquire

Buchanan on broadly the same terms as the WPP deal, but over a lower

earn-out period.



WPP, led by chief executive Martin Sorrell, already owns Hill and

Knowlton and Ogilvy Adams and Rinehart, but has no specialist UK

financial PR agency.



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