INTERPUBLIC TO SELL OFF BUSINESSES, CONTINUE LAYOFFS

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(June 20, 2001) -- Interpublic Group of Cos.' executive vice president and chief financial officer, Sean Orr, said Interpublic would begin a "pruning of their portfolio" over the next two quarters.

"Interpublic, as have all our competitors, has been on a very aggressive acquisition track over the last four, five, six years," Mr. Orr said Monday at the Mid-Year Media Review. "Interpublic has bought hundreds and hundreds of businesses, it has sold very few. As we create a new Interpublic ... we're looking at some of these businesses and seeing if they fit in the strategy that is the foundation of the new Interpublic. Candidly, some of them don't."

Mr. Orr added that Interpublic would have relatively few acquisitions this year. "We'll have a tighter, more stringent mentality toward acquisitions in the short term," he said.

Mr. Orr also confirmed that Interpublic is creating three main marketing services silos -- each with an ad agency anchor -- as well as a fourth corridor deemed "Advanced Marketing Services." In addition, he hinted at further layoffs at the holding company's member agencies.

Following its acquisition of True North Communications, Interpublic will begin "eliminating any of the redundant corporate functions," he said, adding that in slowing economic times "you focus on retaining clients ... and get ruthless about costs."

Interpublic's main areas of cutbacks will be focused on "people, real estate ... and battening down the hatches on discretionary spending," he said. -- Laura Petrecca

Copyright June 2001, Crain Communications Inc.

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