FOX TO CLIMB MT FUJI

Foxp2’s tie-up with Ja­panese giant Dentsu gives the SA agency ac­cess to world-class me­dia think­ing, great data an­a­lyt­ics and other skills, but might this com­pro­mise its in­de­pen­dence?

Financial Mail - - FEATURE - Jeremy Maggs jmaggs@iafrica.com

The Cape-head­quar­tered Foxp2 agency has sold a ma­jor­ity stake to the Dentsu Aegis Net­work, part of the Ja­pan-based Dentsu ad­ver­tis­ing and pub­lic re­la­tions giant. Both par­ties have opted not to dis­close the pur­chase price, pend­ing reg­u­la­tory ap­proval.

Foxp2 is one of the last re­main­ing SA top-tier in­de­pen­dents and in 12 years has de­vel­oped a re­spected creative rep­u­ta­tion. In the most re­cent Gunn Re­port on agency per­for­mance in terms of global awards suc­cess, it was ranked the sec­ond-most suc­cess­ful lo­cal agency. Among its clients are FNB, Stan­lib, Namibia Brew­eries, Bud­get In­sur­ance, Hyundai and Mugg & Bean.

Af­ter reg­u­la­tory ap­proval Dentsu Aegis will own just over 52% of the busi­ness. Its rev­enue last year was R61m and it em­ploys 80 peo­ple in Cape Town and Jo­han­nes­burg. The lo­cal Dentsu op­er­a­tion in­cludes Carat, Iso­bar, Poster­scope and Vizeum, and adding a high-end creative op­er­a­tion will make it a for­mi­da­ble player in the SA mar­ket.

And that, says Foxp2 CEO Charl Thom, is what at­tracted him and his three part­ners to the deal.

“We have been ap­proached by most of the big net­works over the years, but be­ing the only creative agency in this group was ap­peal­ing. We will have ac­cess to in-house ser­vices that have been lack­ing. This deal also gives us a spring­board to work­ing on more clients in [the rest of] Africa.”

Thom says the Dentsu tie-up gives

Foxp2 an op­por­tu­nity to flex its global mus­cles.

“We were told by Dentsu that our work can stand up against the best in any board­room, and as a re­gional cen­tre of ex­cel­lence in the net­work we will now have a chance to work on global briefs.”

Thom is well aware that, sell­ing brings a dan­ger of com­pro­mis­ing the in­de­pen­dence that made the agency suc­cess­ful in the first place. “It can be a huge prob­lem, and we’ve seen this hap­pen . . . with other deals. How­ever, [our] found­ing share­hold­ers, An­drew White­house, Grant Ja­cob­sen and Justin Gomes, will re­main ac­tive and in­vested in the busi­ness; we will still be able to de­ter­mine which staff to hire and which clients to work with and there are no plans to move of­fices into the big­ger op­er­a­tion.”

Dentsu is buy­ing a suc­cess­ful agency for­mula which will add value to its big­ger op­er­a­tion in terms of the com­ple­men­tary skills Foxp2 of­fers. “In turn we now have ac­cess to world-class me­dia think­ing, in­cred­i­ble data an­a­lyt­ics, global ex­pe­ri­en­tial best prac­tice, and ad­di­tional digital, con­tent and so­cial me­dia skills. It brings to­gether a com­plete and in­te­grated mix of ser­vices and ex­per­tise, both lo­cally and in­ter­na­tion­ally, that will greatly en­hance the Foxp2 of­fer­ing to our clients while creat­ing new growth op­por­tu­ni­ties for our team.”

Thom also be­lieves there is a solid fit be­tween his agency and Dentsu. “We love it that they place huge im­por­tance on cul­ture and team build­ing. Ev­ery year they take the whole com­pany to climb Mount Fuji as a sym­bol of their fight­ing spirit. “They have been do­ing this since 1925.”

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