Bates reeling after Mars loss

Bates Worldwide is finalising plans for redundancies and beginning a new-business assault in an effort to deal with the loss of more than $300m (£200m) of Mars business.

Mars shifted $350m of confectionery and petfood accounts out of Saatchi & Saatchi last week following a review triggered by the ousting of Maurice Saatchi. Bates is the ultimate loser because it handles 90 per cent of the business – $40m (£26m) revenue – and has lost accounts which represent seven per cent of the agency’s revenue.

It has been suggested the acc-ount loss will make some of Bates’ European offices vulnerable.

“We will have to look at how we operate, and that may mean we will need to make redundancies – but selectively,” says Bates chief executive officer Michael Bungey. “No Bates office in any country will close. Those offices where Mars represented a disproportionate amount of business will be helped out by the rest of the network. We are not in the game of getting involved with corporate politics, but rebuilding the business.”

It is understood that at least four European and three Far Eastern offices held a “disproportionate” amount of the Mars business. Japan is thought to be particularly exposed.

Bungey refused to identify individual offices. He also dismissed suggestions that the loss made the agency – the more profitable part of the Saatchi agency network – more vulnerable to a takeover bid. NW Ayer tabled a $375m (£246m) bid in December but it was put on hold after the departure of Maurice Saatchi.

News analysis, page 21

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