News that global telecoms operator WorldCom is the latest US corporate giant to suffer a fraud implosion has impacted adversely on the stock price of French-owned ad conglomerate Havas, whose subsidiary network Euro RSCG MVBMS handles the account – and also a slice of WorldCom operating unit MCI Group.
Havas shares on the Euronext stock market slid by more than 4% Wednesday as investors panicked lest the ad shop be hit by massive unpaid bills. But the fears are groundless, assures Havas’s Paris-based vp communications, Simon Gillham.
All of WorlCom’s payments are current, insists Gillham, and there are no “past dues”. The agency had been in touch with its devastated client.
“We realize the situation is changing and we are working with them on a partnership basis so that things can move on smoothly,” says Gillham, pointing out that MCI needs to continue recruiting customers and “needs to advertise ... they can't just suddenly stop that”.
It has been estimated by Merrill Lynch that WorldCom accounts for some one percent of Havas’s revenues which (assuming that Merrill got it right) makes the telecoms giant one of the ad group’s largest clients.
Data sourced from: AdAge.com; additional content by WARC staff