Wpp To Acquire Buchanan Communications

In a new version of Victor Kiams famous penchant for liking the product so much he bought the company, WPP Tuesday confirmed it was buying Buchanan Communications, the London-based financial public relations company of which it has been a client for more than 10 years. It also confirmed it was pressing ahead with the long-cherished plan of Martin Sorrell, chief executive, to pool the media operations of its two advertising agencies, Ogilvy & Mather and J Walter Thompson. The new company will be called MindShare, and will operate in the UK from the first quarter of 1998, before spreading to the groups other European markets. The two agencies already have a joint US media operation, with $14 billion (8.6bn) of billings between them. WPP is paying a maximum 15m for Buchanan, comprising an initial 4 million in cash and up to a further 11m depending on earnings over the next five years. Tim Anderson, one of Buchanans co-founders, said that to achieve the full price we will virtually have to double he size

 

of our business. Another executive said the maximum would be paid only if profit growth reached stratospheric levels.