Bell Pottinger files for administration in wake of Gupta controversy

Bell Pottinger, the UK public-relations firm founded by an adviser to the late prime minister Margaret Thatcher and slammed for stoking racial tensions in South Africa, has filed for administration.

Bell Pottinger named financial adviser BDO to oversee the process, the newly appointed accountant said.

The PR company lost clients and staff over its controversial work for the Gupta family in South Africa and was expelled from the UK’s PR trade body last week.

“Following an immediate assessment of the financial position, the administrators have made a number of redundancies,” a BDO spokesman said.

“The administrators are now working with the remaining partners and employees to seek an orderly transfer of Bell Pottinger’s clients to other firms in order to protect and realise value for creditors.”

Bell Pottinger, which made a profit of £11 million (Dh56.6m) on revenues of £33m in 2015, was criticised by an industry body after an investigation found its work on behalf of the Gupta family had included a racially-divisive social media campaign.

The company’s actions “brought the industry into disrepute,” the UK’s Public Relations and Communications Association (PRCA) said, according to Bloomberg.

London-based Bell Pottinger initially sought to sell itself, a move that failed amid the exodus of clients and staff. Executives at Bell Pottinger could not be reached for comment.

“Bell Pottinger has been heavily financially impacted by the well-publicised issues resulting in losses of clients, partners and staff, and culminating in the expulsion from the PRCA,” BDO said.

“White monopoly capital” was one of the slogans Bell Pottinger used on behalf of Oakbay Capital, an investment holding company run by Gupta family.

Bell Pottinger had attracted attention in the past for taking on controversial clients such as the former Chilean dictator Augusto Pinochet’s foundation.

According to a 2016 report by the Bureau of Investigative Journalism, a US-funded anti Al Qaeda propaganda campaign that Bell Pottinger carried out in Iraq included fake insurgent videos used to track those who accessed them.

The appointment of the administrators became effective on Tuesday and a number of redundancies have already been made.

Bell Pottinger’s operations outside Britain have not been put into administration, AFP reported.