DaimlerChrysler in $13m Payoff to True North

05 January 2001

German/American auto giant DaimlerChrysler is to pay True North Communications $13 million in compensation for shifting its US advertising business out of FCB Worldwide and into Omnicom-owned BBDO [WAMN: 6-Nov-00].

The payment to FCB's parent group covers the premature termination on 1 January of its contract with FCB - five months ahead of its expiry. It also includes some transition and severance costs as well as certain lease obligations assumed by the automaker and its new agency.

But the payment did not cover everything, said True North, and the group will take a fourth quarter restructuring charge of between $17m - $20m, or 19 cents to 23 cents per share.

True North also endorsed analysts’ earnings forecast of $2.14 per share for the current fiscal.

News source: Financial Times