Largest Independent New England Shop Would Report to Lowe
BOSTON–The Interpublic Group of Cos. has its sights set on yet another New England shop.
Mullen, the largest independent shop in the region, is in talks to be acquired by the holding company that one year ago bought fellow New England shop Hill, Holliday, Connors, Cosmopulos, sources said.
Chief executive officer Jim Mullen last week denied that a sale of his 30-year-old shop is imminent, although he acknowledged that “there’s not a major, acquisition-minded organization” that he hasn’t talked to recently.
“I talked with Foote, Cone & Belding on Saturday, and I have definitely talked to IPG, Omnicom and two organizations in Canada,” Mullen said. However, one source said Mullen is further along with IPG than any other possible suitor. “We remain an independent agency today,” Mullen insisted.
Mullen added that the agency’s status as one of the few remaining midsize U.S. independents would change: “At some point, it’s inevitable.”
He reiterated his longtime principle that he has a “fiduciary responsibility” to his employees to explore any offer he receives. “That’s my job,” he said.
The talks with Mullen seem to fit with IPG’s strategy of increasing revenues through acquisitions, even if it’s a little at a time. Hill, Holliday, for instance, represents only 3 percent of all IPG’s revenue.
Mullen also appeals to IPG because it works with General Motors, which is serviced by several of the holding company’s shops, sources said.
IPG declined comment.
For Mullen, or any other independent midsize shop, one benefit to selling to a holding company (other than the financial rewards) is to gain access to international resources.
One Mullen client–toolmaker The Stanley Works in New Britain, Conn.–is conducting a review for a European assignment, an account Mullen is ill-equipped to service, for example.
Mullen claimed billings of $254 million and revenues of about $38 million in 1998.
IPG’s smaller agencies are usually aligned with larger shops in the network.
Sources said Mullen, for example, would report to IPG through Lowe & Partners/SMS in New York. This raises the possibility of Mullen and Lowe working together when necessary, as is already the case with Hill, Holliday, which uses Ammirati Puris Lintas’ international resources.
–with Noreen O’Lear
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