The knock-on effect of the ‘Seneca affair’ and the subsequent resignation of long-serving Omnicom Group director and former chairman of its audit committee, Robert J Callender – revealed earlier this week in the Wall Street Journal [WAMN: 10-Jun-02] - has sent Omnicom shares into freefall.
By close of business yesterday (Wednesday) the shares had lost 19% of their value – a day on which the Dow Jones industrial average leapt by more than one hundred points
Although the advertising and marketing services group (the world’s third largest after WPP and Interpublic) implemented a damage control exercise which included an extended conference call with analysts, this cut little ice with the market and Omnicom’s share price dived $15.28 in value to close at $62.28 (€66.06; £42.37).
Protested president/ceo John Wren of the WSJ story: “We feel there are numerous inaccuracies and in some instances improper innuendos in the article.” But publisher, Dow Jones was unmoved: “We stand by our story,” said a spokesperson.
London-headquartered business daily, the Financial Times, also ran its own version of the ‘Seneca story’ yesterday, hitting Wall Street newsstands as bleary analysts groped toward their terminals. The paper’s two-pennyworth is also thought to have contributed to Omnicom’s shares freefall.
Data sourced from: Financial Times; additional content by WARC staff