The PR bull market gave way to another deal last week when Ogilvy PR purchased Alexander Communications, one of the PR high rollers in technology.
Ogilvy estimates it will bring in between $75 and $80 million in fees in 1998; about $16 million will be an offshoot of the Alexander acquisition. Ogilvy, acquired by WPP in 1989 and headquartered in New York, posted just over $55 million last year. It is leaning toward alliances and acquisitions as a way of competing against other leading PR companies.
In a deal broached about a year ago and brokered over the past five months, Ogilvy closed its agreement with Alexander Communications Oct. 19. Exact terms of the sale weren't disclosed.
Alexander Communications has earned a place on the roster of well-known firms because of its long-running relationship with clients such as Hewlett-Packard [HWP] as well as its work with fledgling ventures including the Forbes' ASAP print supplement. Even before the acquisition was closed, both companies worked together to cultivate a greater client base, including the Forbes account.
Alexander, with 1997 billings at just under $10 million, will operate as a wholly owned subsidiary under the name, Alexander Ogilvy Public Relations Worldwide.
This acquisition represents only a short tally of the deals struck among PR firms in recent months.
Partnerships have ranged from the unprecedented acquisition of IPR (owner of Shandwick and Golin/Harris) by Interpublic to Edelman's purchase of GTT Communications in Austin.
The deal should help Alexander bolster services it can offer its global clients and help it expand its IR and "public affairs in technology" practice. Public affairs in technology is a rather new moniker for identifying how federal public policy (taxation or privacy, for instance) has an impact on technology companies.
All 160 of Alexander's employees will be brought on board, with each of its offices remaining intact. Current offices are located in Atlanta, Boston, Dallas, Denver, Los Angeles San Francisco, and in the Silicon Valley, according to Holland Carney, executive VP and GM of Alexander's San Francisco office.
After the acquisition, Ogilvy's new employee base will top 630.
Carney was among the lineup of Alexander executives introducing Ogilvy CEO and President Bob Seltzer to Alexander employees during a trip to several of the firm's offices last week.
Seltzer has been CEO of Ogilvy only since last June when he replaced John Margaritis who stepped down by agreement with management.
This is the first Ogilvy acquisition Seltzer has sealed, but the CEO says it likely won't be his last.
(Ogilvy Public Relations Worldwide, 212/880-5200; Alexander Ogilvy Public Relations, 415/923-1660)