Sir Martin Sorrell (pictured), whose WPP marcoms group owns 18 per cent of old colleague Lord Bell’s Chime Communications, says he opposes the plan by Lord Bell and other senior managers including Piers Pottinger, to buy out parts of the company’s PR division.
“I think it sets a terrible precedent,” Sorrell says. “It isn’t logical, and if you start to dismember the management of it, where does that begin and where does that end?”
Sorrell, of course, is famously reluctant to allow WPP staffers to walk way from the company with bits of business in their pocket. For many this has resulted in financially painful and humiliating experiences at the hands of WPP’s lawyers.
Chime is a rather different affair though. It’s a quoted company on the London Stock Exchange and Bell would have to agree a fair price for any such move (which, presumably, would also see him leave). As an 18 per cent shareholder Sorrell can probably only grumble in the wings in this instance although as a former colleague (the two both worked at Saatchi & Saatchi where Bell was managing director and Sorrell finance director) and the man who bailed out Chime in its early days as recession struck, Sorrell is probably entitled to be miffed.
There is the further possibility that WPP might spoil the Bell and Pottinger party with a bid though. Chime is currently valued at just over £180m which doesn’t look too demanding on revenues of £326m and operating profits of £32m.
The spat has emerged as Chime reported decent numbers for 2011 despite a slight fall in its communications division (which includes high-flying agency VCCP) and a bigger one in PR after losing some US government business. Its recent heavy investment in sports marketing built around its Fast Track company is paying off though.
So why do Bell and Pottinger want out? It’s probably an age thing: Bell is 70 and Pottinger 57, although Sorrell (67) wouldn’t see that as an excuse either.