Lowe & Partners has held secret talks with Manning Gottlieb Media about buying a 49 per cent share of the company. But Lowe sources say talks, instigated by Lowe chairman Frank Lowe, have broken down over price.
The source says MGM would have been an ideal fit for Western Media, with its strong emphasis on media planning. He denies Lowe is looking at buying any other media independent. However, Lowe is concerned that it needs to build volume.
“Obviously we have to stay up there with the big players to remain competitive,” says the source, “especially with all the centralisations taking place.”
He adds that there is pressure from Interpublic (IPG) to merge the TV buying operations of the three main IPG media brands: Initiative, Universal McCann and Western International Media.
“There is a lot of jockeying for position about which will be the lead agency in such an arrangement, and volume will obviously be a determining factor in which operation will come out on top,” says the source.
Western formally launched at the start of this year. It is the European media agency for Lowe Howard-Spink in the UK and includes executives from Western in the US and Initiative on its European board.
MGM is widely regarded as one of the most attractive media hotshops, with billings of about 100m and clients include Goldbrand, Virgin, Nike, Johnson & Johnson, Eurostar and Suzuki.
MGM is understood to have held talks with several other parties, including New PHD.
MGM is 49 per cent-owned by founders Nick Manning and Colin Gottlieb. TMD Carat has a 19 per cent stake in the company. MGM combines its volume with TMD in negotiations. MGM is also 30 per cent-owned by TBWA Simons Palmer.
Gottlieb confirms that talks between Lowe and MGM have taken place.