In a statement, Colin Hickson, vice president of Propaganda, cited the "depressed economy and the events of September 11" for the changes. The majority of those cut were from support services.
The statement did not mention CEO Trevor Macy's departure, but executives said he is expected to produce feature films for the company. A replacement for Mr. Macy is not expected to be named.
Propaganda also announced that it plans to restructure the company, whose main assets are Propaganda and Satellite, which produce commercials and music videos, and had "raised equity capital to prepare ... for the potentially difficult economic climate ahead." The company also has a talent management unit and a feature film division.
Mr. Hickson told AdAge.com that the funding came from Propaganda's parent company, SCP Private Equity Partners, a venture capital firm. Mr. Hickson indicated that the injection of new financing was not only intended to help the company streamline operations but also was designed to attract outside investors.
"A streamlined, well-run, overhead-conscious production company, with the talent and the assets of the film division that we have, is obviously very attractive," Mr. Hickson told AdAge.com. "There are always, and always have been suitors. ... We are happy to entertain conversations with people because we have a product that will be better suited to the economic environment."
Originally an independent outfit founded by a group of directors and producers in 1986, Propaganda quickly became successful and was later bought and sold by a series of companies including Polygram, Seagram Co., and the Sundance Group in partnership with SCP.
Propaganda is currently in production with several of its award-winning directors, including Dante Ariola, who is shooting a Nike campaign for Wieden Kennedy the directing team of Kuntz Mcguire, former MTV creatives who are directing a Volkswagen campaign for Havas Advertising's Arnold Worldwide and Josh Taft, who just completed a Jeep spot for Omnicom Group's Pentamark.