The two largest African-American agencies in the nation are exploring sales, joining the ad industry's global merger-and-acquisition frenzy.
UniWorld Group, New York, is in talks with a number of potential buyers, including Young & Rubicam.
And Crain's Chicago Business reports this week that Burrell Communications Group, Chicago, is actively courting suitors after talks with investment group Lighthouse Holdings stalled.
Byron Lewis Sr., founder and chairman-CEO of UniWorld, confirmed the agency has had talks with Y&R. The two share several key clients, including AT&T Corp., Colgate-Palmolive Co. and Ford Motor Co., so a pairing makes sense.
"We're talking to a lot of people, and a lot of people are talking to us," Mr. Lewis said. "We have to be realistic . . . If our chief ethnic competitors are talking to global companies, we should, too. We have to stay competitive."
Burrell reportedly has hired AdMedia Partners to represent it to potential buyers, and has made its financial information available to the ad industry's largest holding companies.
Burrell and UniWorld are by far the biggest agencies specializing in marketing to African-American consumers. Burrell posted gross income of $21.4 million in 1997 on billings of $168 million, while UniWorld had $17.6 million in gross income and $162 million in billings, according to Advertising Age data.
Both agencies are pioneers in African-American advertising, and both are led by their strong-willed founders, Burrell's Thomas Burrell and UniWorld's Mr. Lewis.
In addition to the clients it shares with Y&R, UniWorld also does work for Burger King Corp. and M&M/Mars.
Conflict problems have not been addressed. Mr. Lewis said he hasn't discussed a sale with any of his clients.
Burrell's client list includes Coca-Cola Co., Kellogg Co., McDonald's Corp., Procter & Gamble Co. and Sears, Roebuck & Co.
Y&R has for some time wanted to add an African-American agency to its holdings. The parent of general-market agency Y&R Advertising, New York, also owns Hispanic specialist the Bravo Group and last year acquired One World Communications, including the Asian-American agency Kang & Lee.
Copyright February 1999, Crain Communications Inc.