BATES EMERGES AS WILD CARD IN BJK&E BATTLE: OMNICOM, TRUE NORTH, WPP ALL SEE NETWORK AS KEY TO INT'L PLANS

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Bates Worldwide is fast becoming a pawn in the war for Bozell, Jacobs, Kenyon & Eckhardt being waged by Omnicom Group and True North Communications.

WPP Group also is believed to be pursuing soon-to-be-independent Bates to form a third agency network in Europe.

Since the possible outcome of the scramble is the creation of the next big global agency network, holding company executives apparently feel they must make a move.

THE TIME MIGHT BE NOW

"Everybody realizes that there are all these opportunities out there, and the time to act on them might be now," said one industry executive. "If you wait, they might not be there when you are ready to act."

True North is said to be looking at Bates as a way to add international muscle to a possible three-way merger between the Chicago-based holding company and BJK&E, parent of Bozell Worldwide. Bates seems to be key because a combination of True North and New York-based BJK&E alone wouldn't solve True North's need for stronger global resources, said agency executives.

One plan is for True North to break up Bates, combining the international operations with Bozell into a global network and tying its Foote, Cone & Belding network with the domestic, said executives with knowledge of the talks.

Such a combination could also help secure the position of True North Chairman Bruce Mason, who has been seen as vulnerable since the collapse of the holding company's joint venture with Publicis Communication.

But the danger for Mr. Mason is that he could well end up losing control of the enterprise to BJK&E Chairman-CEO Chuck Peebler, who observers said will fight for control of the post-merger company as a condition of a deal.

None of the agencies involved would comment on the discussions.

NO TALKS SINCE EARLY MAY

Mr. Mason said his company has not talked to Bates parent Cordiant since the London-based holding company announced earlier this month it would separate its two New York-based networks, Bates and Saatchi & Saatchi Advertising Worldwide. FCB is "a strong, complete global network," especially since last year's acquisition of Wilkens International, Hamburg, which expanded its reach in Europe, he said.

Agency executives said London-based WPP wants to combine Bates with its Conquest operation for a third European network. It would join J. Walter Thompson Co. and Ogilvy & Mather Worldwide.

There also is some talk that a sale of Bates would come before Cordiant splits up, and if that happens Cordiant could simply be renamed Saatchi & Saatchi Advertising and continue to trade publicly, these executives said.

MAY BE LEGAL ROADBLOCKS

The Bates/WPP scenario, however, could run afoul of British securities law, which according to industry observers would bar Bates from entertaining offers before its expected public offering later this year.

WPP Chief Executive Martin Sorrell would not comment.

Industry insiders speculated Mr. Peebler may be playing True North and Omnicom-still in the race for BJK&E-off of each other in order to bid up the price. It wouldn't be the first time, according to observers, who noted that True North has held talks with BJK&E in the past.

Although Omnicom executives earlier said they are not interested in a fourth network, the holding company wants BJK&E because the two have several common clients-including Chrysler Corp. and American Airlines. But any deal would be contingent upon reaching an acceptable purchase price.

Omnicom President-CEO John Wren is said to be balking at BJK&E's hefty $400 million-plus price tag, which observers said should be closer to $300 million.

COURTING CHRYSLER?

Even so, Omnicom executives were trying to line up support last week from Chrysler, a major client of both agencies, according to executives close to Omnicom.

Mr. Wren is said to have gone to Detroit last week to meet with officials at the automaker.

"I believe Omnicon is making a full court press for Bozell," said an executive close to Chrysler.

But although one executive close to the parties said BJK&E will make a deal within two weeks, Mr. Wren said "No deal is imminent."

Contributing: Pat Sloan, Jean Halliday, Alice Z. Cuneo, Chuck Ross

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