Yesterday Finsbury Glover Hering agreed a deal to buy US rival Sard Verbinnen, creating a company worth the thick end of a $1 billion.
The overwhelming reaction of rivals to the deal goes like this: it’s smart, but there are headaches down the road.
Sard never really cracked London and Finsbury was an M&A also ran in the US – until now.
It’s a deal Brunswick for instance, might have to worry about. If Brunswick is Goldman Sachs and Finsbury is Morgan Stanley, well Morgan suddenly looks well placed to challenge for the number one slot.
The new firm will race up PR league tables, which makes it easier to attract the best talent.
The flip side is the chance that existing Finsbury staff find the integration tiresome or wonder about the loss of the culture they built up.
Sard are hard nuts by repute. Yanks doing business in London always look slightly out of place, and not just in PR. Then again, they will only have 20 folk in London against 120 for Finsbury, so if there is a fight, our side ought to win.
Brunswick might note that it prefers to grow organically precisely to avoid these issues – it values its own culture too much to put that at risk.
Lastly, the number of egos kicking around the merging firms is considerable. They require soothing. There are four (4!), US co-CEOs. That’s, like, too many.
And assuming there is a float coming down the road, as soon as next year perhaps, well what happens after that? Who stays, who goes?
For FTI and Teneo the question posed is, how should they respond? By doing a deal, or just chasing each other’s best staff?
For the others, what does the future look like as regional players?
This merger proves that corporate communications is now really big business, and truly global.
This isn’t the last deal in the sector.
Probably, says this from McDonald’s which is offering a free guide to the most confusing terminology.
Most people have heard of the term “net zero”, but a third of them don’t know what it means.