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Dweck closes shop; Fallon makes cuts

The New York-based creative agency Dweck is closing its doors after nine years of working on small accounts but winning big awards. Fourteen employees will lose their jobs. Founder Michael Dweck's career plans have not been determined.

Separately, as expected, Publicis Groupe's Fallon, Minneapolis, June 26 trimmed 30 positions, or about 6% of its work force, "from various departments and levels" due to the shaky economic climate, cutbacks in expenditures and revenue pressures. "We're sick about it," said a spokeswoman, who added the move was a "last resort" after making cost reductions and other cutbacks. Agency leaders were hoping to avoid the paring with a win of the $400 million AT&T Corp's account, but Fallon was cut two weeks ago from the final round, making the move inevitable (AA, June 25)., Organic move toward buyouts, New York, and Organic, San Francisco, both took steps toward the potential buyouts of their companies. Both are minority-owned by Seneca Investments LLC, an e-services holding company jointly managed by Pegasus Investors II and Omnicom Group. Omnicom transferred its shares in and Organic to Seneca earlier this year. The board of announced that it had approved the merger between the company and E-Services Investments Agency Sub LLC, a wholly owned subsidiary of Seneca Investments that, upon completion of the deal, will be absorbed into Seneca increased the price to $3.35 per share from its original proposal of $3 per share, made on May 14. The merger will be considered for voting at a special meeting expected by the end of the third quarter.

Organic filed an ownership statement with the Securities & Exchange Commission June 26 detailing the formation of a new company, called Cinagro (Organic spelled backward). The new Delaware corporation, which absorbs the holdings of an investment entity called Organic Holdings, will own 59.5% of Organic and certain other unidentified assets. Organic Chairman Jonathan Nelson is the majority owner of Cinagro. Cinagro's purpose, according to the document, is "to enhance the value of Holdings' interest in the Common Stock by placing the stock in a corporation with no operating history. It is hoped that Cinagro might be a more attractive company for potential investors or potential purchasers." The document continued that Cinagro is currently "negotiating terms for the sale of the shares of Common Stock held by Cinagro to third parties, including other substantial shareholders of Common Stock." At least one of those third parties is believed to be Seneca, which stated earlier this month that it was in negotiations to buy more of Organic's stock.

Seneca currently holds a 17.3% stake in Organic and a 45.3% stake in Organic closed at 47› on June 28; closed at $3.22.

Unilever to maintain ad, promotion spending levels

Unilever expects to maintain advertising and promotion at around 14.9% of sales in the second quarter, the same as a year ago, despite declining media costs in Europe and the U.S., Howard Green, head of investor relations, said June 26. Overall, he said Unilever expects sales in the quarter to grow 4% to around $11.5 billion, excluding the effects of last year's Bestfoods acquisition and divestitures, such as Elizabeth Arden cosmetics. Growth is expected to be slower, however, in the U.S. and Europe, coming in at around 3%, he said. The Anglo-Dutch package-goods giant expects earnings to grow 5%. Sales growth came in slightly below the expected 4.5%, he said, citing several factors, including scaling back quarter-end trade promotion spending behind the Mazzola cooking oil and Hellman's mayonnaise brands that had been used by Bestfoods in prior years. He said the launch of laundry detergent tablets in the U.S. has been disappointing, with the segment so far capturing only about 2% of the $4.9 billion laundry detergent category, compared with 10% or more in some European markets. Unilever is launching All and Surf tablets later this year.

Envoy, Leagas Delaney buyout deal crumbles

As expected, Envoy Communications Group's long-awaited deal to acquire U.K. agency group Leagas Delaney has fallen apart. First announced in November, completion of the deal was repeatedly delayed as Envoy struggled with a plummeting share price, and Leagas Delaney made cutbacks in its San Francisco office and lost clients at home in the U.K. "Each party felt that a strong strategic fit exists between the two organizations, but we could not settle on a valuation of the business that would benefit the shareholders of each organization," said Geoff Genovese, Envoy's president-CEO.

Rapp Collins gets $25 mil DirecTV account

DirecTV awarded an estimated $20 million to $25 million new direct-marketing assignment to Omnicom Group's Rapp Collins Worldwide after a review that also included Publicis Groupe's Publicis Dialog, Salt Lake City. The project, which includes direct-response TV, direct mail and interactive marketing for DirecTV's direct-to-consumer sales channel, will be handled out of Rapp's Dallas and Los Angeles offices. A DirecTV spokesman said Interpublic Group of Cos.' Deutsch, Los Angeles, will remain its lead agency for general advertising.

Krispy Kreme names GSD&M agency of record

After six years, Krispy Kreme Doughnuts formalized its relationship with GSD&M, Austin, Texas, officially naming the Omnicom Group shop its agency of record. GSD&M will help the doughnut purveyor in its brand expansion plans but didn't disclose billings for the assignment. "People don't just love the doughnut; they adore the brand," said GSD&M President Roy Spence in a statement. "Krispy Kreme is about more than hot doughnuts; it's an experience. We look forward to finding new ways to extend that experience and their brand to a growing audience." Krispy Kreme's 2000 initial public offering was one of the sweetest stock offerings of the year.

Seymour named editor of `Marie Claire' mag

Hearst Magazines June 28 announced Redbook editor-in-chief Lesley Jane Seymour, 44, will succeed Glenda Bailey as editor in chief of Marie Claire's U.S. edition. Ms. Bailey recently left the magazine to succeed Kate Betts as editor in chief of another Hearst publication, Harper's Bazaar. Ms. Betts left on May 31, after what was viewed as a disappointing tenure at the women's fashion title. Under Ms. Bailey's leadership, Marie Claire grew 56% between 1996 and 2000 according to the Audit Bureau of Circulations. Hearst launched the edition in 1994. Ms. Seymour took the helm of Redbook in November of 1998 after stints as editor in chief of YM, beauty editor of Glamour and several editorial positions at Vogue.


Dial Corp. has licensed the rights for the sale of Breck hair care products in North America, Europe and Asia to Himmel Hair Care Products, the companies announced. ... XM Satellite Radio reached an agreement with Viacom-owned MTV Networks to broadcast two 24-hour music channels under the MTV and VH1 brands. Terms of the deal were not disclosed. ... Yahoo! has agreed to buy online music company Launch Media as a way of expanding its online entertainment offerings. The Santa Monica, Calif.-based company is being bought for 92 cents per share or a total price of $12 million. ... Verizon Communications announced that Janet Keeler, senior VP for brand management and marketing communications, is retiring. Jody Bilney, formerly president of consumer markets in Verizon's Retail Markets Group, will succeed Ms. Keeler. ... As expected, Havas Advertising has completed its acquisition of, a publicly held i-shop in which it had held a minority stake. The transaction calls for 22.7 million shares outstanding of common stock to be swapped for 2.1 million Havas shares. will be incorporated into Havas' Euro RSCG Worldwide network.

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