Agencies Mergers and Acquisitions M&C Saatchi

Why M&C Saatchi has revived an old Conservative election poster


By Sam Bradley | Senior Reporter

June 29, 2022 | 6 min read

Most ad agencies work to reach external audiences, such as consumers and other businesses. But in the latest twist in its months-long acquisition fight, M&C Saatchi has begun advertising to its own shareholders in a bid to persuade them to reject the advances of tech entrepreneur Vin Murria.

M&C's 'Double Whammy' poster, revived as part of a letter sent to shareholders this week

M&C has revived an old campaign poster in its acquisition battle / M&C Saatchi

In a 48-page letter to company shareholders posted today (June 29), M&C Saatchi released an updated version of a famous campaign originally put in service of Conservative prime minister John Major’s election efforts.

The letter led with a version of the 1992 poster rewritten to ward off shareholders tempted by Murria’s ”double whammy” offer, which the company’s board characterized as both lowball and high risk. Inside, its executive committee warns shareholders that ”the ADV offer carries a high risk of damaging your company’s culture, triggering a talent exodus, revenue loss and value destruction.

”The ADV strategy, as laid out in its prospectus, demonstrates a lack of knowledge and understanding of our business and clients. It is reliant on an M&A strategy with no guarantee of success.”

But the decision to release such a strongly-worded missive against a potential owner of the business highlights how unpredictable the situation actually is.

In August, M&C shareholders are set to vote on whether or not they will accept two takeover offers. Next Fifteen, the agency group that recently acquired Engine, and AdvancedAdv, an investment vehicle led by Murria, have been contending to buy M&C since January – but at the time of writing, M&C’s board has not recommended either deal.

”There’s a hell of a lot of shareholders, and to get to a majority – to know what the majority will choose to do at any one time – is very hard,” explains Barry Dudley of M&A consultancy Green Square. ”As a board, they’re doing what they think is in the best interests of the company. But shareholders could vote to change the board, if they think it isn’t representing things properly. The shareholders will ultimately decide if they want [the deal] or don’t want it. The board is giving their recommendation, but the shareholders will make up their own minds.”

Though the board rejected Next Fifteen’s most recent approach on the grounds of price, they stated that they were still open to merging with the group. The letter focused on dissuading shareholders tempted by Murria, who has outlined a plan to rapidly expand M&C with mergers and acquisitions. That scheme, as well as the material price of her offer, has been criticized by M&C’s board, which has led the company through a period of strong performance following its 2019 crisis.

”Their performance at the moment is bloody amazing, given the Armageddon that’s going on around us. They’re having a pretty good run,” says Dudley. ADV’s strategy implies ”a very different approach.”

M&C Saatchi’s revival of an old campaign poster is likely to appeal to its shareholders’ beliefs in strong creative. Though the company was formed in 1995, its founders Maurice and Charles Saatchi had a close relationship with the Conservative Party – their previous company Saatchi & Saatchi (now part of Publicis) created the infamous ’Labour isn’t working’ election salvo, and M&C later made the ’New Labour, new danger’ posters for the party in 1997. ’Double Whammy’ was considered such an effective poster that it’s kept in the permanent collection of the V&A Museum.

”The idea is to create momentum around themselves, and to make themselves look more attractive to Next Fifteen as a company that lives and breathes creativity, even when they’re in a boardroom and shareholder battle.”

Murria and ADV claim it already has the backing of some voters. And shareholders of public firms, Dudley points out, frequently clash with boardroom leadership. That can prove a major distraction for a business – as with Shell, which was targeted by activist investors last year, or at the beginning of the last decade, when WPP investors rebelled over the size of then-chief executive Sir Martin Sorrell’s pay packet.

If a majority of shareholders plump for the ADV deal against the recommendations of M&C’s executive committee, it could place the board in an uncomfortable position – and even lead to a changing of the guard at the agency group.

”Often, these battles end up with someone leaving. There are plenty of occasions where a board has wanted something and shareholders have won,” Dudley says. ”All 18 [of the executive committee] have said they don’t want it. If, say, ADV are voted to be the preferred partner, they could all potentially go.”

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