The bells toll for Chime ad agency
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Your support makes all the difference.Lord Bell's foray back into the advertising business is ending in a move that will renew speculation that he is about to strike a deal with the young pretender to his public relations crown, Matthew Freud.
Chime Communications, the quoted PR group which Lord Bell chairs, is to sell HHCL, the advertising agency it bought five years ago for £24m, to Sir Martin Sorrell's WPP Group. The deal will value HHCL, which has recently lost key clients such as the AA, Tango and Egg, at less than half that amount.
HHCL will become part of WPP's Red Cell network and in return Chime will be given a minority stake in Red Cell. WPP already owns a 20 per cent stake in Chime, which it took when Chime bought HHCL. Lord Bell and Sir Martin are old sparring partners, having worked together at the advertising agency Saatchi & Saatchi in the 1980s.
The HHCL sale will add to speculation that Chime is ready to expand its PR interests. The group, which owns agencies Bell Pottinger, Good Relations and Smithfield, has been in talks with two rivals, Freud Communications and College Hill.
Matthew Freud, one of the best known PRs in London, bought his PR business back from US giant Omnicom for £10m last year. He has a niche in high-profile consumer and celebrity PR, acting for clients as varied as Geri Halliwell and the Millennium Dome. Although Chime wants to expand into the consumer area, sources close to the talks say that Mr Freud is believed to be more keen to strike a deal than Lord Bell.
However, Chime's talks with College Hill, a financial PR agency run by Alex Sandberg, about merging its business with Bell Pottinger, are believed to have broken down.
Chime suffered a poor year last year with profits down 14 per cent, largely due to weaknesses at HHCL. Lord Bell has instituted a cost-cutting regime which has seen 150 people at Chime lose their jobs in the past 12 months.
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