True North Communications

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True North Communications was established in January 1995, succeeding Foote, Cone & Belding Communications as the holding company for Foote, Cone & Belding, one of the largest agencies in the U.S.

With the establishment of the holding company, True North Communications and FCB both continued to make strategic acquisitions and focus on global opportunities. In 1995, FCB acquired Megacom, China, renaming it FCB Megacom; and in 1997, it acquired Bosman Johnson as part of the Lindsay Smithers/FCB South Africa network. In 1998, FCB Worldwide acquired Giovanni Communicacoes, one of the top five independent agencies in Brazil.

Smaller but strategic additions for FCB came in 1999 with the acquisition of McElroy Communications, a youth-oriented marketing organization from Southern California, and Hacker Group, a direct marketing agency based in Seattle. In 2000, the agency added Ad Fabrika, a creative shop, to its existing operations in Poland.

This strategy for growth was played out on a much larger scale by the holding company itself. Between 1995 and 2001, True North acquired, among others: Bayer Bess Vanderwarker (in January 1996, merged with FCB); Harrod & Mirlin Ltd., Toronto (1996); Wilkens International European Network (1997); Bozell, Jacobs, Kenyon & Eckhardt (1997); Don Coleman Advertising (1999), then the U.S.' No. 3 African-American-owned advertising/marketing agency; KSL Media (1999), the No. 2 independent media management company in the U.S.; Imada Wong Communications Group (2000), a leading Asian-American marketing communications company; and Genus Media (2000), parent to MBS Media in the U.K.

True North ended 2000 with the announcement that it would add Springer & Jacoby, Germany's No. 1 independent advertising group and a DaimlerChrysler agency, to its operations.

In its first 30 months of existence, True North acquired 24 separate businesses, virtually all of which were international or technology companies. With its acquisition of BJK&E in 1997, True North became the No. 6 holding company in the world, according to Advertising Age, with $11.5 billion in billings, $1.2 billion in revenue and more than 11,000 employees in approximately 300 locations worldwide.

In 1996, True North acquired Modem Media, a digital marketing services company, to operate under the TN Technologies banner. That agency in 1998 was merged with Poppe Tyson (part of the BJK&E package), to form one of the top three interactive marketing communications companies in the world. Reflecting the company's elevated stature in this new market, two of its units—Modem Media Poppe Tyson and R/GA Interactive, a leader in broadband technology—were among the six agencies chosen by IBM Corp. to support its global interactive marketing program.

As True North grew, however, an earlier FCB partnership with Publicis was becoming increasingly contentious and bitter. By the time True North was formed late in 1994, problems had already developed. A year earlier Publicis had bought a French company that owned a U.S. agency called Bloom Advertising, an FCB rival.

This purchase angered FCB Chairman Bruce Mason, who had been the only member of the FCB board who voted against the partnership with Publicis in 1989. When Mr. Mason announced early in 1995 that True North would seek a majority interest in Publicis-FCB and that the company would set out to build its own European network, Publicis Chairman Maurice Levy decided to end the partnership.

More than a year of bitter negotiations followed before the parties agreed in principle on terms of separation in March 1996; however, the company created by the original agreement continued to function.

Finally, in January 1997, the partnership ended with True North divesting itself of Publicis-FCB, which became Publicis Europe. Publicis continued to hold an 18.5% stake in True North. With the True North acquisition of BJK&E, the relative size of that stake dropped to 11%. In July 1997, Publicis announced a hostile takeover of True North, a strategy whose intent many believed was to undermine the BJK&E merger. In December 1997, True North sued in federal court, which quickly put a stop to the Publicis bid and the merger of BJK&E was consummated.

True North's growth strategy at the turn of the century emphasized promoting organic growth (increased billings from new accounts); building FCB's global position; encouraging greater development of global brands in the high-growth areas of marketing communications; and optimizing collaboration between different operating units.

However, the loss of the $240 million DaimlerChrysler account in 2000 was a major setback for FCB and one that made True North a vulnerable takeover target.

In June 2001, Interpublic Group of Cos. bought True North for $1.63 billion in stock to create the world's largest advertising company, based on its combined $7.1 billion in 2000 revenue. It finished 2001 in the No. 2 spot behind WPP Group, with $7.98 billion in worldwide gross income and $66.7 billion in worldwide billings.

True North no longer exists as an separate entity.

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