The addition of Buchanan makes Burson “immediate strength in financial communications in key international markets and the power to expand this expertise at scale”said Corey duBrowa, CEO of BCW and future global CEO of the combined company.
The move, which takes effect immediately, will add around 45 staff and turnover to Burson's London business by around £9m to £10m. It is already expected to be the largest in the country when Burson officially launches globally on July 1.
The Buchanan Communications brand will remain within Burson following the merger, along with Hill & Knowlton, GCI Health and AxiCom.
The Buchanan team remains in its office in the City of London for the time being. Scott Wilson, CEO of BCW EMEA, who will hold the same role at Burson, told PRWeek “would make perfect sense” to relocate them next to Burson at WPP's Rose Court site on the South Bank “Sometime”although there is currently no time frame for such a move.
The senior Buchanan team, including chairman Richard Oldworth and senior partner Bobby Morse, will report to duBrowa through Wilson.
Wilson described the addition of Buchanan to Burson as “an opportunity to play for us”. The reaction to the news was “generally positive” from Burson executives in other EMEA countries where they see a benefit from working more closely with the brand, he said.
Wilson added: “Our goal is to build our customers' reputation. And an important part of promoting and protecting reputation [is] We must be able to reach all stakeholders in all aspects of their business. When we talk about the financial markets and the capital markets, that's something in terms of the skills and expertise that Buchanan will bring and that will actually complement anything that Burson can currently do globally.”
Another “additive” Element is about ESG and sustainability, which Buchanan looks at through the “lens” of “Investment ability”Wilson said.
Last year, Buchanan, which was founded in 1984 and acquired by WPP in 1997, repositioned itself as an integrated strategic capital markets consultancy after expanding its ESG advisory and creative design offering.
Wilson told PRWeek: “Of course, at Burson we talk about ESG and sustainability from many, many perspectives – from reporting and technical reporting to broader reputation and proactive campaigns. This effectively gives us a 360° view. As we move forward, how can we effectively develop a more comprehensive differentiation offering? This is, in my opinion, just one example of how bringing Buchanan into Burson will be great news for both sides.”
When asked whether the Buchanan brand might exist in other markets outside of London at some point in the future, Wilson said: “Yes I think so.
“I think the name Buchanan has a resonance at the moment, supposedly in London – and of course a very proud resonance and tradition – and I think that actually has value.
“We must be able to reach all stakeholders. Buchanan effectively gives us access to the investor/financial capital markets. I think that has value in and of itself. How the branding will work – as they say at Disney, stay tuned…”
Customers
Buchanan's clients include consumer, leisure and gaming; energy and renewable energy; financial services; industry and infrastructure; investment companies; life sciences and healthcare; mining and metals; professional services; and technology, media and telecommunications. Recent gains include JP Morgan Global Core Real Assets, ABDRN Diversified Income & Growth, oil services company OEG Offshore and mining company Sovereign Metals.
Buchanan had sales of £9.4m and pre-tax profits of £1m in 2022 and employed 45 people at the end of the year, according to documents filed with Companies House. PRWeek believes the 2023 numbers were largely the same.
Morse said about a third of Buchanan's customers were based outside the UK. Through collaboration with BCW and H&K, the agency has had access to markets abroad in the past.
“The idea is to expand it and then use the local network,” he said. “It is a very logical step for us to be part of Burson'We want to offer our existing and potential customers the opportunity to look beyond the London market.”
Morse said there will be no layoffs related to the merger, but added that there will be “no overlap” in the roles, there are no customer conflicts either.
On the prospect of adding more WPP agencies to Burson, Wilson said: “You never say never. But I think we can honestly say that we have enough to do at the moment!”
DuBrowa said of Buchanan's addition to Burson: “Building a good reputation to increase brand and business value requires engagement with all stakeholders, including capital markets.” On strengthening financial confidence or “investment capacity” Beyond an organization, managing relationships with the investing public is critical to optimizing and protecting a company's valuation and reputation.
“Bringing Buchanan’s exceptional team to Burson gives us immediate strength in financial communications in key international markets and the clout to expand this expertise at scale.”
Oldworth said: “The establishment of Burson as a market-leading powerhouse in the global communications industry provides Buchanan with an exceptional opportunity to consolidate its leading position in London and expand its operations internationally.
“We share a common vision with Burson to build and protect a strong reputation, add significant value and put our customers first as capital markets continue to evolve and offer exciting global opportunities.” The extensive global network and the The complementary capabilities that Burson offers will be of tremendous value to our existing and potential customers.”
Trading challenges
Morse described 2023 as “probably one of the worst years in history… in terms of capital markets and in terms of demand for deals and IPOs etc”.
“Apart from that, we are doing well because we have a very robust business. Our customer base is almost entirely repeat customers and we do not rely on transactions. But by closing deals, growth comes and you can get better margins etc and last year was difficult.”
Morse said that “negative dynamics” Was “still there” albeit at the beginning of this year “Things seem to be accelerating – let’s say slowly”. The pipeline of work “If we look ahead, things are looking much better”he added.
“We're seeing some daylight now, some streaks of light coming through. We're now starting to blow the dust off some of our plans, some IPOs that were scrapped last year.
“Is the risk appetite of growth companies currently high and willing? No, I would say the market is still extremely cautious about investments.”
Wilson said the deal was a broader future Burson business “currently a mixed picture” in EMEA.
“It feels a bit like Europe at the moment: if one wins, someone else loses. The pipeline is incredibly strong, but I think we need to interrogate the pipeline much more than we would in a normal year. This isn't just about everyone growing together, which is of course what we hope for, but I think this is a broader macroeconomic question.”
However, when it comes to the Middle East, he said this is the case “There is still a huge appetite and demand for agencies like us”. “So this is obviously a big growth opportunity for us.
“I wish we could say the same about some of our other continental markets at the moment.”
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