Continues With Consolidation of Marketing Units Into Euro RSCG

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NEW YORK (AdAge.com) -- Havas executives said the company has completed the bulk of layoffs and office closings expected as part of a previously announced restructuring plan, and is better than halfway through a consolidation of its marketing services operations.

Havas has enacted 70% to 80% of the 850

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layoffs it had planned and 75% of 40 offices marked for closing have either been vacated or will be by year-end, said chief financial officer Jacques Herail.

But management noted only one sale has been completed among seven units placed on the block.

One global network
Havas executives held a conference call this morning to give financial analysts a progress report on the reorganization, which was announced Sept. 18, after the company posted a dismal first-half earnings report. The plan would streamline its structure into a single global network, Euro RSCG, with Arnold Worldwide as a "creative alternative" in key markets worldwide and MPG handling media assignments for both.

President and Chief Operating Officer Bob Schmetterer said two-thirds of the Arnold units slated to join Euro RSCG have been integrated, including Brann Worldwide offices in New York, Chicago, San Francisco, London and Toronto. Additionally, 50% of marketing services businesses under the disbanded Specialized Services unit that were slated to be merged into Euro have already been integrated, he said.

Meanwhile, the sale of businesses has progressed slowly. Chairman-CEO Alain de Pouzilhac said one unit, U.K. call center Contact 24, has been sold and two other units are expected to be sold in the coming week, while negotiations over four others continue. He did not identify the units, but Mr. Herail noted the sales are expected to raise a total of 50 million euros, or $57 million.

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