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True North Communications appears to have answered the nagging question of how to expand its international presence by folding much of Bozell Worldwide into sister agency Foote, Cone & Belding to form FCB Worldwide.

Last week's deal to merge FCB and Bozell, as expected (AA, Aug. 16), makes the resulting FCB agency the U.S.' largest agency brand, at an estimated $448 million in gross income. Worldwide, FCB moves up from No. 15 among consolidated networks to No. 12 with gross income of $819.5 million.

"A giant global agency was formed overnight," said Brendan Ryan, now CEO of FCB Worldwide. "So get out of the way."

He said among worldwide agency networks, the deal moves FCB to No. 4 in Latin America, to No. 11 in Asia from No. 19, and up two slots in Europe to No. 17.


If "big" was the word of the day at FCB, "sacrifice" was the one at Bozell Worldwide, where TN Chairman-CEO David Bell spent 25 years. Last week, the country's 14th-largest agency brand lost its worldwide status and megaclient DaimlerChrysler to FCB, as it was reduced to a shell of its former self with $91.7 million in gross income, all in North America. On a consolidated basis, Bozell was a $371.9 million agency worldwide.

In the realignment, FCB also gained Bozell's Costa Mesa, Calif., and Southfield, Mich., offices, the latter largely serving DaimlerChrysler.

True North executives tried to put a positive spin on Bozell's situation. They said Bozell now could concentrate on its domestic business without supporting global operations while still maintaining the capabilities of FCB's international network to service clients such as Bausch & Lomb's Ray-Ban and Unisys.

Outsiders weren't so enthusiastic. "What it does to Bozell really, despite their words, needs to be seen," one consultant said.

Officially, Bozell has five U.S. offices, one in Canada and no overseas operations. TN, however, has not decided how to handle London, where there are several client conflicts: Bozell's Del Monte Foods and FCB's Tropicana Products; Bozell's Unisys and FCB's 3M Corp.; Bozell's Bestfoods and FCB's Sara Lee Corp.; and Bozell's Financial Times and FCB's The Daily Mail.

Another recurrent conflict problem for FCB and Bozell will be the automotive category. Like many networks without a major international car client, FCB handles different auto brands at the national level. FCB/Wilkens, Hamburg, won the Volvo Car Corp. account earlier this year for Germany, the home market of the Daimler half of Bozell's DaimlerChrysler business. Besides Volvo in Germany, FCB agencies work for Rover in France and Denmark and for Nissan Motor Co. in Portugal.


Despite the problems, analysts and consultants agreed the deal buoys TN's global network.

"They're going from two medium-size agencies with limited global reach to be at least on the same footing as their direct competitors," said Leslie Winthrop, managing partner for agency search company AAR/Bob Wolf & Partners. "Global was a priority."

About 30% of TN's operations are abroad, compared with half for Omnicom Group.

"At least on Wall Street, the sense is that big is better. Here's a way they can be big and have a big market impact," said Morgan Stanley Dean Witter & Co. analyst Mike Russell. "They'll get on the list more easily of top agency brands" and could win more business.


Mr. Bell did not rule out the eventual acquisition of another network but said organic growth was the priority. He insisted there are no plans to further merge domestic FCB and Bozell operations.

Three co-presidents will report to Mr. Ryan: Ron Bess for North America, London-based Harry Reid for overseas operations, and Kelly O'Dea for media and business development worldwide. Former Bozell Worldwide Chairman-CEO Leo-Arthur Kelmenson was named FCB Worldwide chairman. Gene Bartley, president, Bozell North America, was named Bozell chairman.

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