INTERPUBLIC SETS GLOBAL ALLIANCE OF MEDIA UNITS: WESTERN, INITIATIVE TEAM TO BATTLE CARAT FOR NO. 1

By Published on .

Interpublic Group of Cos. plans an alliance of its two strongest media services brands-Western International Media in the U.S. and Initiative Media outside the U.S.-according to executives familiar with the situation.

The union of the two media giants, with billings approaching $10 billion, is meant to compete with Carat International, the $8 billion-plus media operation that is trying to make a serious dent in the U.S.

Initiative is now the media arm of Interpublic's Ammirati Puris Lintas network outside the U.S.

Philip H. Geier Jr., Interpublic chairman-CEO, would only say: "We are continually evaluating our media and other endeavors, and no decisions have been reached."

Michael Kassan, Western's president-chief operating officer, declined comment.

NO GLOBAL PRESENCE PREVIOUSLY

It's likely the alliance will be branded Western Initiative Worldwide, although primarily for conflict reasons Western's current offices in London and Paris will remain separate from those of Initiative.

While both Western and Initiative have been successful in their own right, "both have lacked a real global presence," said one executive close to the media shops.

"Multinational clients are increasingly looking for one global media source," this executive said. "This gives IPG a way to compete with Carat and avoid the conflict situation [that] going after certain media clients could present to IPG's full-service agencies."

There is speculation Western will eventually become the media buyer for New York-based Ammirati, which currently buys about $250 million in media.

SARA LEE PITCH

Agency insiders discouraged that speculation, even though Western and Ammirati this week are jointly pitching to retain the $100 million Sara Lee Corp. media account.

Initiative Media is well-known outside the U.S. as the media buyer for Unilever. The package-goods giant is by far Initiative's largest client and could account for up to half of Initiative's $4.5 billion to $5 billion in billings, according to one executive familiar with the company.

Initiative is the most aggressive of the agency-owned media specialists in Latin America. It has five offices there.

The new structure spins off Initiative as a unit separate from Ammirati, according to one executive familiar with the plans, making Western-Initiative a separate financial unit. Initiative Chairman Marie Josse Forrissier will continue to head up the company's non-U.S. operations.

IRONIC PAST

Interpublic was the first agency holding company to acquire a major independent media buying service when it bought West Hollywood, Calif.-based Western in 1993.

Ironically, Western executives at one time were negotiating a deal with Carat for that company to become Western's non-U.S. presence. Western founder and CEO Dennis Holt introduced executives of prized client Walt Disney Co. to Carat managers with that game plan in mind.

The deal feel through, however, and while Carat and Disney hooked up outside the U.S., there was never a Western/Carat alliance.

In this article:
Most Popular