Cordiant may lose Hyundai as stock dives
The troubled Cordiant Communications Group – parent of Bates UK – looks set to lose one of its key US advertising accounts, and its share price has plummeted.
Hyundai Motor America is reviewing its &£140m advertising out of Bates USA West. The account has been with Bates since 1986. The car manufacturer dropped Bates USA West from its media account over the weekend.
The group saw its share price close at 90p as Marketing Week went to press – its lowest closing price so far this year and a drop of nearly five per cent on the previous day (January 28). A week ago (January 23), the share price stood at 104p.
The depressed price could leave the group open to acquisition by big global ad players.
Cordiant filed three profit warnings near the end of 2001, and is renegotiating its overdraft with bankers. Under chief executive Michael Bungey, it has sought to expand by integrating companies from all marketing and communications disciplines, but analysts suggest it has paid over the odds for acquisitions such as The Lighthouse Global Network.
No one at Bates UK was available for comment. Bates does not hold the Hyundai account in the UK.
