Ayer and Hal Riney & Partners are into deep discussions regarding a marriage between the two privately-held agencies. Such a move would create a new entity with billings of $1.8 billion and solve a number of issues ranging from succession at Riney to expansion for Ayer.
According to a source, they have reached the due diligence stage, although a number of issues could still unravel the negotiations.
"It's serious but it's not done yet," said one source. "Plus, Ayer is still talking to at least two other agencies about an acquisition."
Riney ceo Hal Riney, who worked at Ayer during his long career and is familiar with top Ayer management, confirmed the talks between the two agencies. "We're talking to them. But we're certainly not close to anything," said Riney. He added, "I'm listening a little more to this one."
In a statement, Ayer ceo Jerry Siano said that Ayer "has spoken to a number of agencies, and we continue to hold dialogue with firms that offer something that can complement the services that we offer to our clients. That's smart business."
Sources said the deal being discussed involves Ayer acquiring Riney; with Hal Riney and Siano sharing coceo roles. The Hal Riney name will likely go on the door as well and some of the agency's executives will receive equity, sources said.
A merger would be relatively conflict-free. Ayer has billings of about $1.5 billion and lists General Motors, AT&T, Procter & Gamble and DeBeers on its roster. Hal Riney's clients include General Motors' Saturn division, Alamo Rent A Car and Stroh Brewery. Following the sale of its New York office, Riney bills around $290 million.
The creation of an Ayer/Hal Riney & Pro%nets makes sense for both parties. Ayer would land the plum car account that it has been thirsting for and bolster its domestic operations with Riney's San Francisco and Chicago offices. Riney would gain access to Ayer's international network. It would also end speculation over who will succeed Riney when he retires.
While the Riney deals motors along, sources said Ayer vice chairman Richard Humphreys is also in negotiations to reacquire Ayer's European network. Ayer Europe ceo Dick Hedger said, "I would not say it's anathema to us-- we are closely linked and already part of a worldwide organization. But the initiative is coming out of New York."
Copyright Adweek L.P. (1993)