Chiat/Day buyer Omnicom Group and other mega-players are eyeing additional independents and some offspring of other parent companies, now that Mr. Chiat is folding his agency's emblematic skull-and-crossbones flag.
Before summer comes-and the irreverent Chiat is officially merged with Omnicom's sensible, streamlined TBWA to become TBWA Chiat/Day-it's likely that Omnicom will do another deal.
The holding company's BBDO Worldwide unit is said to be among those considering an acquisition of Ross Roy Communications, Bloomfield Hills, Mich., and McKinney & Silver, Raleigh, N.C. True North Communications, parent of Foote, Cone & Belding, is also among those said to be interested in Ross Roy, valued at $30 million to $40 million.
Ross Roy will make a decision by the end of the month, reported Crain's Detroit Business, a sister publication of Advertising Age.
Both N.W. Ayer & Partners and Bozell Worldwide are in the buying mood, too, and are said to be talking to Ross Roy. But look out, Bozell. True North is said to be eyeing you. Another quarry of True North and Ayer is believed to be Saatchi & Saatchi Co. unit Campbell Mithun Esty.
Omnicom Chairman-CEO Bruce Crawford wouldn't comment on possible purchases other than to note his company isn't on an "acquisition binge. Our acquisitions will be largely sane and not often very large. They will be strategic."
Which could mean that McKinney, priced at $12 million to $15 million, would be a good fit, though the agency denies it's for sale.
True North's objective of becoming an agency holding company is one factor putting pressure on rivals to make any moves they might have been delaying.
The deal that joined TBWA (billings of $1.1 billion) and Chiat (billings, $919.9 million) was no doubt a good one for Mr. Chiat, but industry insiders who know him say the silver-haired agency maverick is lamenting the sale. Debt incurred by his agency, said to have totaled $40 million, is believed to have been a major factor prompting the sale.
"It's the end of an era," said one insider, who noted the entrepreneurial chairman-CEO was encouraged by Chiat executives to make the deal, valued at $60 million.
Bill Tragos, 60, chairman of TBWA International, said: "I understand exactly how he feels, but he'll see he has put his agency not only in my careful care but in a company, Omnicom, that cares about advertising."
The largest potential account conflict lies in the beverage category. Chiat handles Coca-Cola Co.'s Fruitopia and Cherry Coke; TBWA sister agency BBDO handles Pepsi-Cola Co. While one executive close to the merger said a decision about the accounts will be addressed later this year, a Coca-Cola spokesman said the company is "not overly concerned."
The agency merger is a power union for Nissan Motor Corp. Chiat handles the company's U.S. Nissan and Infiniti divisions as well as Nissan business in Canada, while TBWA works for Nissan in Europe.
Computer marketers are likely to love TBWA Chiat/Day since Chiat has worked for Apple Computer, Toshiba America Information Systems and Dell Computer Corp. Coincidentally, both agencies have been pitching Epson America's estimated $20 million account. Chiat has now withdrawn from that review.
Mr. Tragos said the two agency cultures are compatible. And in a possible indication of that, TBWA plans to embrace Mr. Chiat's latest innovation-the concept of the `virtual agency,' in which staffers work without offices and are linked by computer and phone.
As part of the deal, Mr. Tragos becomes chairman-CEO of the combined operations. Lee Clow, managing director of Chiat/Day in North America, becomes chief creative officer.