McConnells is bought by its rival DDFH&B
Published 17/04/2010 | 05:00
ICONIC advertising agency McConnells went into receivership yesterday morning and was bought out by fellow agency DDFH&B just hours later.
The dramatic events followed a fortnight of takeover talks between the two agencies and months of talks between McConnells and its bankers.
Sources confirmed that Ulster Bank installed Kavanagh Fennell's Tom Kavanagh as receiver over McConnells yesterday morning. DDFH&B then bought out its one-time rival in a deal described as "extremely complex".
The receivership and instant sale was structured because Ulster feared that a longer receivership would have prompted clients to flee McConnells', destroying the iconic company's value and putting 75 jobs at risk. Ulster was advised in the deal by corporate finance experts Key Capital.
It is understood that McConnells' key executives will stay involved in the new business, which is expected to retain the McConnells' brand as well as the brand of its media division MCM.
DDFH&B will examine the "viability" of McConnells' business over the coming weeks, a process that may lead to the closure of some divisions. The outlook for the agency's workers was unclear last night.
DDFH&B will attempt to make the transfer of ownership as "seamless" as possible for the agency's clients and creditors'. Founded in 1916, McConnells is Ireland's most iconic ad agency, and is one of the only players that hasn't joined forces with an international agency.
McConnells lost a number of key executives over the last year, including former MD Fiona Scott who set up a new agency 'Boys and Girls' with several senior McConnells staffers.