A deal could be signed as early as this week with Berlin Cameron, a four-year-old independent founded and run by Chairman Andy Berlin and CEO Ewen Cameron.
If the deal is completed, the acquisition would give WPP Chief Executive Martin Sorrell a more credible base from which to build Red Cell, his fourth global agency network and one for which he has considerable ambition. Currently, the network's only U.S. office is Cole & Weber, a low-profile Seattle shop. Red Cell had gross income of $81 million last year, according to Advertising Age figures. Mr. Berlin is expected to become global chairman of Red Cell and will anchor a three-person executive management team.
Mr. Sorrell declined comment. Mr. Berlin said only that his agency has been approached by various holding companies but that no deal has yet been signed. The negotiations were first reported on AdAge.com Nov. 30.
For Berlin Cameron, the sale would provide the agency access to the global resources it needs to compete in a marketplace that has grown increasingly hostile to small- and mid-size independents. Although Berlin Cameron has attracted a blue-chip roster of clients, including Coca-Cola Co., Reebok International, Cablevision and Ralston Purina, its hold on some of those accounts was shaky because of its limited resources. The agency had gross income of $20 million last year, according to Ad Age. (Berlin Cameron is also agency for Ad Age.)
The WPP deal could have an immediate, positive impact on the agency, solidifying its hold on Coca-Cola's Dasani water account on a global basis; Berlin Cameron had been slated to lose the business to Interpublic Group of Cos.' Foote, Cone & Belding Worldwide. WPP itself was just recently added to Coca-Cola's roster when Ogilvy won the Sprite and Fanta accounts, and retaining the Dasani business would strengthen its ties to the soft-drink giant.
The marriage also would resolve Red Cell's impending leadership vacuum. Luca Lindner, the London-based CEO of Red Cell, is set to depart for Bcom3's D'Arcy Masius Benton & Bowles. Under WPP's plan, Mr. Berlin will operate as chairman of Red Cell from New York. In addition, WPP has hired Lee Daley, a planning executive who departed Interpublic Group of Cos.' McCann-Erickson Worldwide, London, several months ago, for a top management spot at Red Cell. A third executive with client-service experience is expected to join Mr. Berlin-who will focus primarily on creative issues-and Mr. Daley at the top of the network. Mr. Cameron will focus on Red Cell's U.S. operations.
Since its launch last January, Red Cell has met with more disappointments than successes. The agency hasn't won any significant accounts in the last year, and suffered a blow when Wind, an Italian cellular telephone company, moved its account. There have also been rumors, strongly denied by Red Cell, that another key account, Alfa Romeo, is on shaky ground.
Mr. Berlin is a high-profile advertising executive who has re-invented his career a number of times. He was a founder of what is now Omnicom Group's Goodby, Silverstein & Partners, San Francisco. After he split with his partners, Mr. Berlin moved to New York and joined Omnicom's DDB Worldwide as president of its New York office. From there, he started a spin-off agency backed by DDB to oversee the Volkswagen account in the U.S. After the client moved the account, Mr. Berlin moved on to a partnership with Fallon Worldwide. Two years later, he left and started the independent agency he is now in negotiations to sell.