Maxxcom to Buy Into Crispin Porter & Bogusky

Crispin Porter & Bogusky’s decision to partner with Maxxcom was driven by a need for capital and a desire to play a significant role in the Canadian network’s growth, sources said.

“It was important to be part of an organization at the beginning of its life cycle rather than the end,” said Chuck Porter, chairman of the Miami agency. “If we’d done a deal with one of the big networks, I doubt their number one priority would be to grow our brand.”

Maxxcom, a division of Toronto-based conglomerate MDC Communications, has agreed to purchase a 49 percent stake in CP&B.

The deal, which was initiated at last year’s 4A’s conference in Ber-muda, is still being finalized.

Sources peg the purchase price at $10-20 million in cash and stock, contingent upon CP&B meeting performance goals. As part of the arrangement, negotiated with MDC chairman Miles Nadal and Maxxcom chief executive Beverly Morden, Maxxcom has a buyout option after five years.

CP&B has consistently received kudos for its advertising (particularly its anti-smoking campaigns for the American Legacy Foundation), but was hamstrung by its lack of support services. Being a runner-up in the recent L.L. Bean and Land Rover pitches drove that point home.

“Over time, this agency can have much larger brands,” said Porter. “We were looking for a shortcut. The most obvious and efficient one is to get someone to invest.”

Porter said he and partner Alex Bogusky had preliminary talks with potential partners including Omnicom and Publicis, both in New York, and Arnold Communications in Boston.

“The reality is they don’t really need us,” Porter said. “With Maxxcom, we’ll be able to help establish a strategy and a vision.”

On CP&B’s wish list is opening a second office and beefing up its media buying and account planning.

MDC’s agency roster includes Margeotes/Fertitta + Partners in New York, Colle & McVoy in Minneapolis and Source Marketing in Westport, Conn.