CORDIANT ANNOUNCES POSSIBLE SALE TALKS
Characterizes Discussions as 'Very Preliminary'
CORDIANT'S BATES LOSES ALLIED DOMECQ ACCOUNT
Holding Company May Suspend Trading
Things have gone from bad to worse for the London-based advertising communications company, which saw global revenues tumble by 10% to $788.5 million in 2002, according to Advertising Age's annual Agency Report.
In addition to watching many of its biggest clients walk out the door over the past 15 months, the company is also hobbled by huge debts, the result of past purchases and a poor advertising climate.
During the last several days, the company's stock value declined to a point 97% below its 2000 peak.
These are some of the milestones in Cordiant's drift toward disaster:
April 2003: Spirits giant Allied Domecq notifies Cordiant it will terminate its services and find another advertising agency. The move may force Cordiant to suspend trading on the London Stock Exchange.
April 2003: British American Tobacco shifts Cordiant Communications Group's 141 Worldwide off the Lucky Strike brand and gives the agency its duty-free promotions duties. Cordiant confirms it is losing Allied Domecq business, valued at $18 million.
February 2003: Cordiant confirms it is discussing the sale of three agency holdings: Scholz & Friends, George Patterson Bates and PR firm Financial Dynamics.
November 2002: Finance director Art D'Angelo leaves to join Interpublic Group of Cos.' McCann-Erickson Worldwide.
October 2002: Cordiant closes Bates West as a result of the company's Hyundai loss. Cordiant unveils new structure, Bates Group, integrating advertising agency Bates Worldwide; direct and interactive firm 141 Worldwide; branding and design consultancy Fitch Worldwide; and health-care specialist Healthworld.
September 2002: CEO Michael Bungey's departure from Cordiant is announced. David Hearn named CEO.
August 2002: After 15 years, Wendy's International moves its $312 million account to Interpublic Group of Cos.' McCann-Erickson Worldwide.
July 2002: Bates loses $200 million Hyundai Motor Co. account. Pharmacy chain CVS pulls its $35 million account too.
May 2002: Bill Whitehead resigns as president of Bates Americas. CEO David Hearn takes on responsibilities. Bates USA combined with Optimedia division of Zenith Optimedia.
March 2002: David Hearn joins Cordiant as CEO of Bates Worldwide.
February 2002: Cordiant renegotiates bank covenants. CEO Michael Bungey announces 9% drop in revenue and 1,100 layoffs.
January 2002: Bates USA West, Irvine, Calif., loses Hyundai Motor Co. Bates parts ways with estimated $15 million to $20 million Department of Defense Joint Recruitment Advertising Program account, but wins Allied Domecq business.