SYDNEY: Hamish McLennan has taken on the big role of chairman & CEO of Young & Rubicam Brands, the holding company formed to oversee WPP’s empire of Y&R and the newly absorbed TCG investment.
McLennan will move up from his current role as Y&R CEO, cementing his position as WPP's local representative. Sir Martin Sorrell flew into Sydney this week to confirm WPP’s long-awaited acquisition of The Communications Group.
The official announcement was made at a press conference this afternoon (30 August).
As speculated, TCG’s flagship agency, George Patterson Partners, will be merged into Young & Rubicam and take on the name of George Patterson Y&R. TCG reported revenue of $132 million for the 2004/05 financial year and had consolidated net assets of $16.6 million at June 2005.
Under McLennan's guidance, Young & Rubicam Brands will oversee Y&R’s seven companies - including Y&R, Wunderman and the campaign palace/red cell - and TCG’s 11 - including Patts, Zenith, IdeaWorks, PPR and HMA Blaze.
The combined entity will boast estimated revenue around the $230 million mark, and bring together 1,400 staff, bumping Y&R to the number one agency ranking.
Zenith will be merged into Mediacom and form part Group M. CEO Anne Parsons will become CEO of Mediacom, but the fate of current CEO, Karen Potter, is unknown at this stage.
TCG CEO Ian Smith will step down following a one-month transition period. He said he was happy to step down because “clarity of leadership is critical in these merger situations”.
“Hamish will be running the show,” Smith said.
For McLennan, the acquisition brings him full circle, back to Patts, the agency where he spent 17 years before defecting to Y&R. “It will be very different,” he said. “Even in the three years since I left, the business [Patts] has moved on and I represent the WPP side now - but I do have a deep understanding of the culture of the agency.”
McLennan said the merger of Patts and Y&R will bring together “the best of both worlds”. “Patts is one of the most iconic agency brands in the country, with a great local history,” he said.
McLennan said the two agencies have yet to uncover any client conflicts. While he declined to comment how the merger will affect Telstra, which has both Patts and Y&R on its agency roster, it is understood the telco was consulted during acquisition negotiations.
Sorrell said the acquisition is part of WPP’s strategy of developing its networks in important sectors and markets. “TCG represents a wonderful opportunity for Hamish McLennan and his mangement team to re-establish Patterson and its sister companies to their rightful position in Australasia,” he said.
While TCG COO Mark Bayliss will also be leaving the company, McLennan said there will not be many redundancies as a result of the merger. “Both organisations are quite lean,” he said.
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