Bell Pottinger is facing an exodus of clients as companies seek to distance themselves from the disgraced PR firm.
The iconic company, which was kicked out of the Public Relations and Communications Association (PRCA) on Monday, is now scrambling to regroup.
City A.M. understands Bell Pottinger wants to name a new boss this week, following James Henderson’s resignation. It has also appointed advisers from BDO to explore a sale of the business and sources close to the company have suggested a rebrand is highly likely in the future.
Wealth management giant St James’s Place, embattled construction firm Carillion and FTSE 250 student property firm Unite Group have emerged as the latest big hitters to ditch Bell Pottinger contracts.
HSBC, meanwhile, said it would no longer be calling on the firm to work on specific projects and law firm Hickman and Rose also ended its relationship. Others, including TSB owner Sabadell, Imperial Brands, Bank of Ireland, TalkTalk and phone mast giant Arqiva, have placed their relationships with Bell Pottinger under review.
Investec, challenger bank CYBG, luxury goods company Richemont and mining trio Acacia, Pan African Resources and Tharisa had previously ditched the PR firm over the scandal, which was described on Monday by PRCA chief Francis Ingham as "the worst piece of PR work I've seen in 10 years".
|St James’s Place||Sabadell|
|Unite Group||Bank of Ireland|
|Hickman and Rose||Arqiva|
|Pan African Resources||
Other companies to have recently terminated contracts with Bell Pottinger include energy giant Centrica, newspaper publisher Johnston Press, accountancy giant EY and Central Asia Metals.
Rival PR firms are on the look-out for new business, with several leading PR executives suggesting that a “significant number” of clients are now thought to be dumping Bell Pottinger.
Elsewhere, the firm’s second largest shareholder has confirmed that it has written off its investment in the business.
Chime, which is co-owned by US investment firm Providence Equity Partners and Sir Martin Sorrell’s WPP group, walked away from its 27 per cent holding in the company. “We can confirm that we no longer have a stake in Bell Pottinger,” a spokesperson said.
Chime’s stake is thought to have been worth around £5m. It had previously owned Bell Pottinger but agreed to a £20m management buyout in 2012, retaining a stake and a seat on the board.
Tim Bell, a founder and former chief executive of Bell Pottinger, said on Monday night that the company would “almost certainly” not be able to survive following the scandal.
Danny Rogers, editor-in-chief of trade publication PRWeek UK, also questioned how much of a future the firm would have yesterday.
“It is certainly hard to remember a more rapid fall from grace for a major PR consultancy,” he said. “Quite aside from the turmoil over the past few days, it is well known that the smouldering scandal has seen the loss of numerous clients and staff in recent months.
“People are also asking whether the Bell Pottinger name is now irrevocably tarnished, particularly with its expulsion from the industry’s biggest trade body for the next five years.”