Cordiant Execs To Make Case For ‘Demerger’

On Tuesday, executives of Cordiant Communications Group PLC–the proposed spinoff of Cordiant PLC whose flagship is Bates Worldwide–will present their case directly to analysts here.
A week later, Cordiant chief executive Robert Seelert will do the same for Saatchi& Saatchi PLC, the other entity to be created by the “demerger” of Cordiant.
The companies’ executives lost little time last week explaining to media and financial observers the merits of dismantling Cordiant in favor of two new independent, publicly traded companies. Cordiant’s seven largest shareholders–which control more than 60 percent of the company’s shares–have already voiced support for it, according to Cordiant. The proposal must be approved at an extraordinary general meeting in London on Oct. 23. Cordiant shareholders will receive one new CCG share and one Saatchi share for every two Cordiant shares.
The proposal also described the size of the new companies, both of which will share ownership of Zenith Media Worldwide. The new Saatchi, which includes Cliff Freeman and Partners, has $612 million in revenues with pretax profits of $36 million. Revenue at CCG, which includes German affiliate Scholz & Friends, is $539 million, with pretax profits of $38 million.
Cordiant also released results for the proposed companies for the first half of 1997: CCG companies reported a 4.1 percent decline in revenue to $254 million, while units in the new Saatchi claimed revenue grew at 0.7 percent to $304 million.