Rogers & Cowan to Be Acquired by British Firm
LOS ANGELES (AP) _ Rogers & Cowan Inc., the nation’s top entertainment public relations firm, said Tuesday it has agreed to be acquired by Shandwick PLC, a leading British public relations concern, for about $15 million.
The companies said the deal will create the world’s largest independent public relations agency - that is, one that isn’t affiliated with an advertising agency. It will have annual revenues of $34 million, with 550 employees serving 600 clients from 25 offices.
The only public relations companies that are larger, both of which are tied to ad agencies and have revenues of more than $100 million a year, are Hill & Knowlton and Burson-Marsteller.
Shandwick’s chairman, Peter Gummer, said in a telephone interview from his London home that he is looking at further acquisitions to expand Shandwick’s operations in the United States, Canada and the Pacific Rim regions of Tokyo, Hong Kong, Singapore and Australia.
Recently, Shandwick acquired Rand Public Relations in New York and Henry Kaufman Public Relations of Washington, D.C. About half of Shandwick’s revenues now come from the United States.
″I believe it is important to continue to expand,″ said Gummer, who has indicated in the past he wants to build an international public relations concern.
He said talks have been held with several companies, adding he expects them to show heightened interest in light of Tuesday’s deal.
Privately held Rogers & Cowan will be paid up to $15 million over four years, with the amount based on a multiple of annual billings.
The company was founded in 1950 with a single office in Los Angeles and revenues of $200,000 the first year. It now also has offices in New York, Washington and London and in 1986 had revenues of $10.5 million.
Rogers & Cowan is best known as the leading public relations firm in the entertainment industry, with such clients as Paul Newman, Sylvester Stallone, Ann-Margret, Elton John, Bruce Willis, Cybill Shepherd, Robert Wagner and Paul McCartney.
But it also is involved in corporate and product public relations, attracting such clients as Ford Motor Co., Mastercard International, AT&T, Polaroid Corp. and Ralston Purina. More than 40 percent of its revenues come from corporate clients.
The company’s top officials have signed four-year employment agreements under which they will retain their titles and independence.
Those officials are Henry C. Rogers, the firm’s founder and chairman of the executive committee; Warren J. Cowan, the company’s chairman; Richard Taylor, president and chief executive; and Paul Bloch, executive vice president.
″It’s a very exciting day for us,″ Taylor said. ″We have been looking for some time for ways to increase our capital and expand our markets. We are proud to have an opportunity to work with the Shandwick group in developing more campaigns on a national and international scale.″
Shandwick’s clients include Beecham Group, Reader’s Digest, Lever Bros., Wilkinson Sword, KLM Royal Dutch Airlines, Nestle, Sears Roebuck & Co, Bristol-Myers Co. and Nynex Corp.
For the six months ended Jan. 31, Gummer said, Shandwick earned 600,000 pounds on revenue of 5.2 million pounds. At current exchange rates, that would be equivalent to income of $966,000 on revenue of $8.37 million.