PITTSBURGH - Money - not power-sharing or real estate - was the primary reason for the collapse of the merger talks last week between Ketchum Communications and Ayer.
Industry sources said last week that the talks were scuttled after Ayer received a last-minute cash infusion of between $10 million and $20 million from an investment bank.
'Ayer found some angels somewhere,' said one source familiar with the deal. 'The new financing has given Jerry Siano (chairman/ceo of Ayer) what he needed Ketchum for - cash - and he didn't have to give up the agency to get it.' While some sources indicated that the financing came from an U.S.-based operation, others said that it may have come from an Asian investment bank.
Other sources said that some recent new product assignments at Ayer, such as Bayer Select, are bringing in millions in new billings which have helped alleviate some of the cash problems.
With the Ayer deal on the back-burner, Ketchum is now on the prowl for New York shops in the $50-million to $150-million range to shore up its presence in the Big Apple.
Copyright Adweek L.P. (1993)