It won't be lack of funds that prevents WPP Group from bidding for Grey Global Group, the former's chief executive said on Monday.
Addressing the company's annual meeting, Sir Martin Sorrell was asked if there is truth in the rumour that WPP is planning to bid for Grey [WAMN: 28-Jun-04]. "I don't think we can comment on that," replied the savvy savant.
He was, however, unable to resist a word to the wise: "'Our market capitalisation is about $12.5bn; Grey's is about $1bn, $1.2bn," he said. You can draw your own conclusions."
Which the meeting promptly did. Especially as Sorrell followed with a loaded rhetorical question: "Consolidation happens everywhere - among clients, among media owners. Why shouldn't it happen to agencies?"
Which in turn begs another rhetorical question given Grey's close relationship with Procter & Gamble and WPP's with Unilever. "How thick are either network's Chinese Walls?"
• On the financial front, WPP's non-executive chairman Philip Lader reported that the group's worldwide revenues rose almost 6% per cent during the first five months of 2004; and by around 2% on a like-for-like basis, excluding acquisitions and currency fluctuations.
He said the main media buying business, which accounts for almost 50% of WPP's revenues, grew by more than 14 % in the January-May period.
Lader added: "Public relations and public affairs, the sector most affected by the recession, has finally started to pick up, with the last quarter of 2003 and the first five months of 2004 showing positive growth,"
He expects the recovery to continue for the remainder of the fiscal, driven by events such as the current Euro 2004 soccer championship, the summer Olympics and November's US presidential elections.
Data sourced from: MediaGuardian.co.uk and Financial Times; additional content by WARC staff