Euro RSCG Worldwide is close to gobbling up one of the largest independent agencies in the U.S.: Jordan McGrath Case & Partners.
The acquisition of the $580 million New York shop is imminent, according to executives close to the discussions. The announcement of a union could come as early as this week.
Talks between the two agencies have run hot and cold over the past several months, but began to heat up over the last few weeks.
A Jordan McGrath spokeswoman said she had no knowledge of the agreement; a Euro RSCG spokeswoman would only say, "I can't confirm or deny" reports.
MARRIAGE OF CONVENIENCE
A deal between Euro RSCG, the world's seventh-largest agency network, and Jordan McGrath is largely a marriage of convenience for shared client Procter & Gamble Co. Chicago-based Euro RSCG Tatham handles such P&G brands as Old Spice, Clearasil and Metamucil, while Jordan McGrath does work for P&G's Bounty, Zest, Safeguard and Era brands.
Both Tatham and Jordan McGrath are under pressure to strengthen their global networks as P&G implements its Organization 2005 restructuring, under which global business units and top P&G managers will have worldwide responsibility for brands.
Jordan McGrath only works for P&G in the U.S. while Tatham handles brands in both the U.S. and Europe.
P&G's major global roster shops include D'Arcy Masius Benton & Bowles, Saatchi & Saatchi, Leo Burnett Co. and Grey Advertising.
Last year, in one of a series of moves to align global brands with global agency networks, Tatham lost P&G's Vidal Sassoon haircare account to Burnett. Jordan McGrath has yet to feel the sting of such consolidations, but its key P&G brand, Bounty, has become increasingly global with expansion in Europe.
In addition to the P&G connection, Euro RSCG is said to have been interested in Jordan McGrath because of the agency's extended healthcare capabilities. The agency's healthcare accounts include SmithKline Beecham, Novartis and Pharmacia & Upjohn.
Jordan McGrath last year acquired Toltzis Communications and the Medical Education Group, both Trevose, Pa.
Euro RSCG has 32 agencies with healthcare expertise. Its two largest holdings are Robert A. Becker Euro RSCG and Lally, McFarland & Pantallo Euro RSCG, both New York.
In addition to Tatham, Euro RSCG's other U.S. shops are Messner Vetere Berger McNamee Schmetterer/Euro RSCG, New York, and Euro RSCG DSW Partners, Salt Lake City.
JORDAN SOFTENS STANCE
Jordan McGrath, which staunchly defended its position as a midsize independent, has softened its stance recently. In interviews, agency executives have said they'd consider being bought.
The agency last year had a management shift, as co-founder Pat McGrath passed his title of president to Stephen Badenhop, who is considered to be Mr. McGrath's eventual successor.
Under terms of this Euro RSCG deal, Jordan McGrath would remain a separate agency under the Euro RSCG umbrella, according to an executive with knowledge of the situation. That would be expected since Euro RSCG is known for a hands-off management style with its agencies.
Contributing: Jack Neff, Beth Snyder.
Copyright January 1999, Crain Communications Inc.