Chime sells off Bell Pottinger business

CHIME Communications yesterday announced a management buyout of its Bell Pottinger businesses for £19.6m in cash and shares.

Chairman Lord Bell and deputy chairman Piers Pottinger will pay £14.9m in cash and step down from Chime to run the new company, BPP Communications.

Chime will hold a 25 per cent stake in BPP and a seat on its board.

The deal needs majority investor approval but Chime’s biggest shareholder WPP, which holds a 20 per cent stake, is unimpressed.

WPP chairman Sir Martin Sorrell has criticised the company’s £19.6m valuation, which is an eight-fold increase on the Bell Pottinger businesses’ 2011 pre-tax profits.

Sir Martin questioned why the company was not valued in terms of revenues, and said “it sets a terrible precedent” for Chime to keep a 25 per cent stake.

Chime’s shares climbed 8.7 per cent to 163p.