There’s plenty of hoopla this week at the Cannes International Advertising Festival, a.k.a. Schmooze City, but Publicis chief Maurice Levy has upstaged the show with another stunning acquisition.
Publicis S.A. and Saatchi & Saatchi PLC disclosed at a news conference here Tuesday that they are merging in a stock swap valued at about $1.9 billion.
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The news didn’t surprise industry observers, because word had leaked out Monday about the deal,which results in a firm ranking fifth among all communications-ad giants.
“This is a good fit for both of us,” said Levy, chief executive of Publicis, who told this column that he approached Saatchi & Saatchi in December about a merger. He waited until March before Saatchi got back to him, saying it was interested.
“That’s when the serious negotiations started,” Levy said.
In May, Publicis was reportedly interested in Y&R Inc., when that agency was being courted by WPP Group, which eventually acquired it. Y&R had looked to Publicis as a white knight when it appeared that WPP wouldn’t meet some of its demands, including compensation packages for certain of its executives.
The Publicis-Saatchi combination provides the new parent, Publicis Groupe S.A., with two major global ad agency networks. Publicis has been looking for an additional network for some time to operate independently of its Publicis Worldwide operation, which includes Publicis & Hal Riney in the United States.
Several months ago, Publicis acquired Minneapolis ad agency Fallon McElligott (now called Fallon Worldwide). Levy expects that agency to become a global network in the future.
Levy, who will be CEO of Publicis Groupe, says he doesn’t expect Saatchi to open any other offices in the United States. It already has units in New York, Los Angeles, San Francisco and Rochester, N.Y.
Total Publicis-Saatchi revenue is about $2.1 billion.
Through acquisitions, Publicis has a major presence in Chicago, with recently acquired marketing services firm Frankel & Co.; a 49 percent equity in Burrell Communications Group; and Publicis Dialog Chicago via a buyout of Selz Seabolt Communications.
Chicago-based Daniel J. Edelman Inc., parent of Edelman Public Relations Worldwide and sister agency PR 21 Worldwide, has been holding discussions to acquire two overseas offices of Saatchi & Saatchi’s Rowland Public Relations firm. Because Saatchi & Saatchi was committed to that deal, those two offices will probably go to Edelman, Levy said.
Acquiring Saatchi & Saatchi also brings into the fold Zenith Media Services, a media management firm in which Saatchi & Saatchi has a 50 percent interest. Coupling Zenith with Optimedia, Publicis’ media buying arm, the combined media operations would rank among the top four worldwide in media buying, with about $16 billion.
Publicis and Saatchi & Saatchi have talked to clients, especially those that might be in conflict, but those firms have OKd the deal as long as Publicis and Saatchi operate independently, much like units of other big players in the communications business.
Publicis’ top clients are Nestle, L’Oreal, Renault, Siemens and Coca-Cola Co. (the agency works for that client in 40 countries worldwide).
Saatchi’s top clients are Procter & Gamble, Toyota, Johnson & Johnson, General Mills and Lexus, a sister unit of Toyota.
– Communicator Marketing Worldwide, a Chicago-based unit of Lighthouse Global Network, named Shireen Moore president. Communicator also promoted Julie Colbrese to chief creative officer, Phil Loftus to senior vice president-account services, and Joe Lagattuta to senior VP-creative services. Jay Farrell, chairman of Communicator (and former president-CEO of predecessor firm Davidson Marketing) remains in that post. John Stanek continues as chief operating officer.
– Andrea Reisener became an area manager in the Chicago market for Remy Amerique Inc., the New York-based spirits importer, including such brands as Cointreau liqueur, Piper-Heidsieck champagne and Remy Martin cognac.
Strictly Personal: Birthday greetings to Laurie Hachmeister, 42 (Restaurants & Institutions); commodities broker Edward J. Mullins, 70; spirits magnate Fred Rosen, 64; Shirley E. Salerno, 47 (Bank One); and Kathleen Henson, 29 (Dome Communications).