Leo Burnett To Up Stake In India Venture To 100%
In a bid to combat growing competition in India, Chicago-based advertising major Leo Burnett Co Inc has decided to convert Chaitra Leo Burnett into a 100% subsidiary by increasing its equity stake in the joint venture to 100% from the existing 51%.
Leo Burnett Co is hammering out a deal to buy out the 49% stake held by the Indian promoters, Walter Saldanha and associates. Chaitra Leos capitalised billing during 1996-97 stood at Rs 119.06 crore, according to the A&M magazine that has rated the advertising agency as among the countrys top 10.
Chaitra Leo is, thus, set to join agencies like Tara Sinha-McCann and Equus where the foreign partners have either hiked their stake considerably on offloads by the Indian promoters, or bought out the Indian promoters altogether over a period of time.
Negotiations are on and an application is likely to be made to the Foreign Investment Promo-tion Board within the next 18 months, sources in Chaitra Leo told Business Standard. Though the foreign collaborator has a controlling stake at present, it wants to up its stake to get total control of the agency.