Publicis to sell True North stake if $700m offer fails

Publicis will sell its existing stake in US group True North if it fails in its $700m (437m) bid to buy the company and look at alternative collaborative ventures with US groups, according to analysts and agency insiders.

Publicis president and chief executive Maurice Levy refuses to say what the group’s next move will be.

Publicis has an 18.5 per cent stake in the US company, which includes the Foote Cone & Belding network. Publicis launched its offer, not yet a formal bid, two weeks ago with a confidential letter to the True North board just as the group was to complete a $440m (275m) takeover of US agency Bozell Jacobs Kenyon & Eckhardt.

If the Bozell deal is struck, Publicis’ share in the merged company will dip to about ten per cent, leaving it with little control and therefore little option but to sell its True North stake and rethink its US strategy. That could only mean buying another group or entering another alliance. Publicis needs a global network to handle Nestlé and L’Oréal, and, increasingly, to compete for MasterCard and Coca-Cola accounts.

Some observers believe the Publicis bid was designed to boost the share price in anticipation of selling its stake once the Bozell deal is complete. True North chairman and chief executive Bruce Mason says: “I don’t know why it (Publicis) would keep its stake in the company after the Bozell deal and tie up a big chunk of assets in an agency that it had less control of.”

News Analysis, page 20

Latest from Marketing Week

PLEASE SIGN IN OR REGISTER. IT'S FREE, QUICK AND EASY!

Access Marketing Week’s wealth of insight, analysis and inspiration that will help you develop as a marketer and leader.

Register and receive the best content from the only title 100% dedicated to serving marketers' needs.

We’ll ask you just a few questions about what you do and where you work, so we can make Marketing Week more relevant to you.

Register now

THE BEST CONTENT

Our award winning editorial team and columnists will ask the biggest questions about the biggest issues on everything from strategy through to execution to help you navigate the fast moving modern marketing landscape.

THE BIGGEST ISSUES

From the opportunities and challenges of emerging technology to the need for greater effectiveness, from the challenge of measurement to building a marketing team fit for the future, we will be your guide.

PERSONAL AND PROFESSIONAL DEVELOPMENT

Information, inspiration and advice from the marketing world and beyond that will help you develop as a marketer and as a leader.

Dedicated to developing your skills and helping you achieve marketing excellence. Find guidance on leadership, professional development and the latest industry jobs.

Having problems?

Contact us on +44 (0)20 7292 3711 or email subscriptions@marketingweek.com

If you are looking for our Jobs site, please click here