Questions to ask

The NW Ayer offer for Bates may have been officially withdrawn, but a continuing role in the Saatchi saga cannot be discounted. Richard Humphreys, a former Saatchi director close to Maurice Saatchi, and major player at Ayer, is currently in South Korea conferring with Ayer’s main financial backer Choi Won-Young. Ayer money, possibly supplemented by funds from Morgan Stanley, could be very useful to Maurice if he does, in effect, make a hostile bid for Saatchi plc. Of course, the nearer to ú1 the Saatchi share price the better…. The subsequent sale of Bates, which unlike the Saatchi network is still very profitable, would more than cancel existing corporate debt…

Could Maurice make a comeback without the messy and expensive mechanics of a takeover? There would first have to be a shareholders’ counter-revolt against the Herro faction, effectively toppling Saatchi chief executive Charlie Scott. Sounds fantastic, but dissident shareholder suits are already being filed against Saatchi directors alleging failure of fiduciary duty. And just look at the wilting Saatchi share price this week. But so what? Let’s not forget Scott hasn’t lost one client – yet. And P&G has reaffirmed its commitment to Saatchi. On the other hand, how much stomach has Scott, the bean counter who wandered into adland, got for a dirty street fight?

How much damage has the Saatchi saga done the advertising industry? In the short-term, a few rival agencies will benefit from Saatchi fall-out. All Saatchi agencies are likely to encounter more resistance in getting onto pitch lists. That should be small comfort to the ad industry which has, in the colourful words of one group agency chief, been revealed as a “horse’s arse”. Client views on the subject would be welcome…

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