Grey Global Group: Pundits Pontificate, Meyer Mute

08 July 2004

As a tsunami of speculation about the future of Grey Global Group [WAMN: 02-Jul-04] threatens to engulf Madison Avenue, its progenitor -- Ed Meyer, Grey's 77-year-old chairman, chief executive and controlling shareholder -- is maintaining a profile lower than that of a lugworm.

Word from within the Grey bunker is that no-one other than chief financial officer Steve Felsher, a long-time Meyer confidante, had an inkling of the mooted sale. Even Grey's North American ceo Steve Blamer (48), widely seen as heir-apparent to the Grey crown, knew nothing of the plan.

In a memo to staff Meyer laid it on the line: "I am aware of the speculation in the press about a possible sale of Grey," he wrote. "You may also have seen the company has adopted a 'no comment' position. Our attorneys advise us we cannot go beyond that.

"When you speak with our clients, this is the appropriate communication and you should adhere to it. The 'no comment' position in this context is well established and you should avoid the natural temptation to go beyond it."

Meantime, institutional investors and the money manipulators are salivating. Drools Tim Fidler, director of research at Ariel Capital Management, which holds 28.5 percent of the agency: "Grey is a terrific asset and our main concern is that the value of the company is realized …we're very comfortable with Ed Meyer, but one of the ways we can realize the value is through a sale of the company."

Good to know the agency is so highly valued by the moneymen -- but maybe Fidler and his ilk need reminding that value can be qualitative as well as quantitative … and that the assets of ad agencies walk through the doors every night … and that their clients are equally able to follow suit.

Names of potential buyers are being bandied with abandon -- Dentsu, Omnicom, Publicis, WPP -- but right now the most accurate indicator of the outcome is a blindfold and a pin.

However the sale pans out, one thing is for certain. Meyer himself will be laughing all the way to the bank. He and a few Grey executives between them hold a controlling 35% of company stock with Meyer's 20% share currently valued at around $240 million (€193.80m; £129.23m).

But in a voting structure not unlike that of Hollinger International, Meyer's 20% holding confers on him more 50% of shareholder votes.

As the icing on the shares sale cake, Meyer is also entitled to a pension of around $1m annually on leaving the company, plus a $3m handout three days after his exit, plus a $5k monthly retainer for consultancy services.

Data sourced from:; additional content by WARC staff