So Rick (Webb, COO Barbarian Group), no truth in the speculation that Cheil Worldwide is buying your company? Funny, I could have sworn the acquisition of a majority stake has just been officially announced. How quickly things can change 180 degrees from an “absolute untruth” to a done deal. It must be that memorandum of understanding you had signed with Cheil that gave you enough wriggle room to be economical with the truth.
An MoE is not strictly speaking a deal, it’s just expresses the intention to sign one. And, of course, the MoE could have expired in less than a month’s time with no deal being struck. I bet no one’s going to come clean about the price tag being $10m for the whole lot though, which is also to be found in the MoE. Note that Cheil could acquire only 49% of Beattie McGuinness Bungay, a UK agency apparently in robust good health. The majority stake – 51% or above – eventually prised out of Barbarian suggests financial weakness on the acquired company’s part.
The deal’s an odd but interesting one, tieing together as it does a maverick US digital agency group, which has all but run out of money, with a highly conventional Korean network, which has plenty but lacks the cultural savvy to get into the digital game. All rather reminiscent of Dentsu’s attempt, unsuccessful as it turned out, to lay hands on Razorfish.
I’ll leave you with the reflections of Seth Alpert, managing director of AdMedia Partners, which advised Cheil on the deal:
“For years large US and European agency holding companies have been adding capabilities in Asia to serve multinational clients in all markets. We believe that Cheil’s transaction with Barbarian demonstrates that Asian advertising holding companies are now executing the same strategy – adding strong US capabilities through acquisition. Another example of this trend is the reported aggressive pursuit by Dentsu, Japan’s largest advertising agency, of interactive agency Razorfish, a company ultimately acquired from Microsoft by Publicis earlier this year.”