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The Prices Are Right For Buying and Selling: Interpublic, Omnicom, Gold Greenlees Trott and Ketchum Eye Targets as Asking Prices Have Fallen By Kevin McCormack with Michael McCarth

NEW YORK – Interpublic and Omnic

Gold Greenlees Trott joint chairman Michael Greenlees makes no secret that, encouraged by the performance of GGT’s U.S. network of GSD&M/Dallas, The Martin Agency/Richmond, Va., and The Joey Reiman Agency/Atlanta, he is interested in acquiring more shops in the U.S. D’Arcy Masius Benton & Bowles, a privately held shop, is said to be looking for a deal to beef up its worldwide communications network. And Ketchum Advertising, whose merger talks with Ayer are in limbo pending the Oldsmobile review, is on the prowl for another acquisition in New York if Ayer doesn’t make it to the altar. Meanwhile, some still think that an Interpublic-WPP Group deal on Scali, McCabe, Sloves could happen this year. But SMS is considered to be only one of the targets of the Interpublic Group at present. Omnicom has been close to striking a deal with the Ross Roy Group and has been linked in the press as a possible suitor of TBWA Advertising.
Unlike the heady acquisition days of the 1980s, the deals of the ’90s are of a different nature. ‘Any acquisition that will take place in the next two to three years will be strategically driven, not financially driven. Those days are gone forever, thankfully,’ said Greenlees.
According to agency execs, the conditions for acquirers are better than they were in the 1980s. ‘Overall, the climate is a lot better to acquire agencies than it was five years ago. There are fewer potential buyers today and the buyers are more astute,’ said IPG executive vp/cfo Eugene Beard.
David Grimbley, an analyst with Hoare Govett in London, said that agency prices are more realistic today because there are fewer buyers. ‘The great advantage is that you won’t get into a bidding war. In the halcyon days you could find four of five bidders out there driving up the price,’ he said.
Omnicom ceo Bruce Crawford said that his company is on the lookout for a ‘strategically sound and sensible acquisition.’ Philip H. Geier, chairman, president and ceo of IPG, said, ‘We would only be looking for companies that fit with what we have already.’
Copyright Adweek L.P. (1993)