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Cheil’s $10m bid to buy the Barbarians

Word reaches me that Korea’s leading agency Cheil Worldwide is acquiring US interactive network Barbarian Group – which has outlets in New York, Boston and San Francisco – for a mere $10m. That’s a lot less than the $44m it appears to have paid for a 49% stake in UK agency Beattie McGuinness Bungay late last year and some are speculating that Barbarian, a whizzy maverick born in the meltdown of the dotcom boom, has finally run out of money. But I couldn’t possibly comment on that.

Bruce HainesWhat I will say is this acquisition has the finger-prints of Bruce Haines, Cheil’s global chief operating officer, on it.

Bear with me. Haines, who has been prized throughout his career for his managerial skill, quit as group ceo of Leo Burnett London in acrimonious circumstances two years ago. The bust-up was over a restructure he profoundly disagreed with. Burnett is Samsung’s lead global agency, so no great surprise to find Haines being snapped up by Cheil, Samsung’s in-house agency (it owns 18%). It was perhaps more surprising to find Haines, who spoke not a word of Korean, decamping with his family to Seoul.

We’re now beginning to get the fuller picture. Haines has been given a war-chest to help transform Cheil from an introverted Korean giant dominated by one really big client into a global micro-network. Not by accident the deal with BMB – one of London’s hottest creative properties – mirrors the BBH relationship with Haines’ former alma mater, Publicis Groupe, owner of Burnett: the aim is arm’s length creative freedom. It has certainly given BMB the financial freedom to set up shop in the USA.

The Barbarian deal looks like a second leg to Haines’ strategy: the strengthening of Cheil USA. So far, the US end of the network has confined itself to poaching key staff (for example, three senior executives from Draftfcb). Now it seems to be swallowing whole agencies. Might we speculate that part of Haines’ end game is to wean Samsung entirely away from Burnett, by providing a convincing alternative resource? BMB has already picked up a handsome Samsung dividend by taking the Cheil Won.

As for Barbarian Group, strictly speaking it is a digital production company which is as likely to hire out its talents to agencies (including Crispin Porter + Bogusky and BBH) as to clients direct. There are certainly signs that it has, like the rest of the agency world, had to make heavy cuts. Last July, it shed about 15% of its staff. The question now is: will its promiscuous, project-led culture be compromised by being a part of Cheil? It’s a strange one, no doubt about it.

UPDATE: I see Rick Webb, Barbarian COO, has been doing his best to deny the story (not very convincingly). My understanding is that Barbarian has signed a memorandum of understanding with Cheil, which will last a month. The owners of Barbarian will pick up $10m if the deal goes through.

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One Response to Cheil’s $10m bid to buy the Barbarians

  1. […] Posts Cheil's $10m bid to buy the BarbariansCarolyn Carter bids adieu to Grey EuropeObama's take on Change4LifeBaillie and Hatton defection to […]

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