Arun Sudhaman 31 Jan 2012 // 12:00AM GMT
LONDON--Chime Communications has revealed that Lord Bell and Piers Pottinger are attempting to buy back the UK’s biggest PR firm.
According to a Chime statement released earlier today, Bell, currently group chairman, and Pottinger, have been allowed to pursue the acquisition of “some of the businesses within the public relations division.”
Chime’s public relations division is typically referred to as the Bell Pottinger Group, which was launched in 1998, and reported fee income of £68m in 2010. The unit houses numerous agencies, including Bell Pottinger, Good Relations, Harvard, Fast Track, Pelham Bell Pottinger and Stuart Higgins Communications.
“No proposal has yet been made and there can be no certainty that a proposal which the board can recommend to shareholders will be forthcoming,” continues the statement.
Sources familiar with the situation told the Holmes Report that any deal is likely to include all Bell Pottinger-branded agencies, which include its public affairs, corporate and financial units. The fate of Good Relations, tech firm Harvard and sports marketing specialist Fast Track remain unclear.
The statement follows the revelation of the budding deal by Sky News city editor Mark Kleinman on Twitter this morning.
Sources noted that an approach for Bell Pottinger would be well timed. The agency lost its biggest client - a US government contract in Iraq - last year, and last month saw its reputation tarnished by a sting operation in the Independent.
Chime warned investors in late 2011 that results would not match the impressive returns it has generated in recent years. It also announced a one-off restructuring charge related to the loss of the Iraq PR contract. Chime’s PR division accounted for around half of its income prior to 2011.
The Chime statement notes that the deal is being pursued by Bell, Pottinger and “certain other members of the senior management team.”
The development follows a string of MBOs within the PR industry over the past 18 months. Matthew Freud bought back another of the UK’s biggest firms last year from Publicis Groupe, while in the US MWW and Brodeur have returned to private ownership.