Saatchi brothers split stake
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Your support makes all the difference.THE SAATCHI brothers, Maurice and Charles, have split their joint stake in the advertising group, sparking fears of a possible share sale by at least one.
The move follows Charles' resignation from the group's board earlier this year after a boardroom rift between the brothers and fellow directors led by Charles Scott, chief executive, who is under presure to cut head office costs.
The group announced yesterday that Maurice, chairman, and Charles, appointed president this month, were dividing up their 1.78 million shares - less than 1 per cent of the group - between them. Although none has yet been sold, it has sparked speculation that Charles plans to quit. Saatchi shares fell 5p to 136p yesterday. They were 180p three weeks ago.
It has also fuelled talk of a change of name by the company to reflect the dilution of its founders' dominance over its affairs. Recent reports have also suggested that the brothers were planning to launch a pounds 200m buyout of one the group's three international agency networks.
Earlier this month the group warned that this year's profits would fall due to further redundancies and lower revenues. Next year's are expected to be 'adversely affected' by the loss of accounts worth pounds 30m.
As a result brokers have slashed their 1993 profits forecasts from pounds 25m to about pounds 18m.
The company is planning to save about pounds 10m from cost cuts but is expanding its successful Zenith media buying business into 10 countries next year, taking the total coverage to 17 territories. A specialist media buying operation for the US market is also a strong possibility.
(Photographs omitted)
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