Agency change as merger talks fail

Financial PR agency Brunswick has stepped down from its accounts with Glaxo Wellcome and SmithKline Beecham after merger talks between the two companies fell through this week.

Financial PR agency Brunswick has stepped down from its accounts

with Glaxo Wellcome and SmithKline Beecham after merger talks between

the two companies fell through this week.



Both used Brunswick as retained City PR agency for the merger talks but

Alan Parker’s agency is believed to have stepped down for an unspecified

period.



Gavin Anderson has been appointed to handle financial PR for SmithKline,

but it is not known whether Glaxo Wellcome has appointed a new

agency.



In a statement, Gavin Anderson said: ’We expect to be retained on a

project basis but that SmithKline will retain Brunswick once this is

over.’ Brunswick is also likely to return to Glaxo Wellcome as well.



Since news of the breakdown in merger talks surfaced on Tuesday morning

shares in the two companies have been hit. As PR Week went to press

Glaxo Wellcome shares were down 248p to 1656p and SmithKline shares down

83p to 724p.



Gavin Anderson’s task is to weather the storm in the City for

SmithKline.



It will report to James Hill, Smith-Kline’s director of

communications.



Hill was not available for comment.



Merger talks between the two pharmaceuticals giants broke down over

disagreements concerning proposed boardroom appointments at the merged

company. Sir Richard Sykes, Glaxo’s chairman, planned to run the company

alongside SmithKline’s chief executive Jan Leschly. However, disputes

are thought to have centred around other positions on the board.



A SmithKline Beecham spokesperson said: ’There was a whole basketful of

issues.’



SmithKline blames Glaxo, saying that it reneged on agreements made

before the merger announcement on January 30. It is the second time in a

month that merger talks involving SmithKline have failed. A proposed

deal with American Home Products also failed to materialise.



The new company would have been the largest in the world after General

Electric with a market capitalisation of pounds 110 billion.



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