CarLand, one of the biggest independent car dealers in the UK, has pulled its £4m advertising account out of Newcastle-based advertising agency Yellow M, forcing chief executive Mike Dethick to put the company into liquidation after more than a decade of trading.
It is believed that CarLand, a brand which was born around two years after the merger with Concept Cars, has now put its advertising account up for review, though nobody at the company was available to comment on this.
Yellow M Newcastle is understood to have been facing a number of financial challenges for some time.
In 2000 the Newcastle agency had some 23 County Court Judgments against it, totalling an outstanding debt of more than £83,000. At the time, however, Dethick assured creditors that they would be paid.
Over the last few years the company has also been rocked by several major account losses, the biggest being the loss of the £7m Reg Vardy account, which was taken in-house in 1998.
Several senior staff members are now said to be forming a ‘phoenix’ agency, possibly to be named Gorilla, which has apparently already secured a number of former Yellow M accounts, which could include Holland & Barrett, DIY retailer Robert Dyas, chemist shop Rolands and the Tyne & Wear Development Agency.
Chief executive Mike Dethick was unavailable to comment on the situation as The Marketeer went to press, but it is believed that he will be involved with either Gorilla or a new television production company in the near future.
A source in the North East marketing community said: “Everyone knew that Yellow M had been carrying debt for the last couple of years, but they seemed to have come out of it so it was a bit of a shock. I think it’s immensely sad and bad for the region.”
The agency’s sister company, Yellow M Edinburgh, has been planning a management buy-out since around February.
According to MD Ian Wright, the MBO will go ahead unaffected by the fate of the Newcastle operation. He said: “Although the two agencies were part of the same group, they were separate companies in their own right, under separate ownership and there was very little contact between them.”