Goodstuff buys out OMG to be fully independent
Goodstuff Communications has become 100% independent after the two founders bought Omnicom Media Group’s 20% stake.
Financial terms were not disclosed but Goodstuff is estimated to be worth about £8m.
Andrew Stephens and Ben Hayes, the founding partners, said the move was a positive sign for the UK’S independent media agency sector because they are optimistic that they can thrive without the backing of a network.
The 13-year-old agency increased billings by 73% to £87.9m last year, according to Nielsen, making it the fastest-growing top 20 media shop in the UK.
Goodstuff’s most recent accounts for 2015 show a £500,000 profit on revenues of £3.8m. Those figures are likely to have increased as the agency has since won a number of clients from big networks, including ITV from Mindshare and Dunelm from Zenith.
Stephens and Hayes quit Manning Gottlieb OMD in 2004 to set up Goodstuff as a planning agency with the support of OMG, their previous employer.
Goodstuff expanded in 2011 by adding buying as a capability but did not use Omnicom’s trading arm.
Hayes said Goodstuff wanted to thank OMG for its “support and help” but both sides felt it was “the right time to shake hands and go our separate ways”.
Stephens and Hayes are joint shareholders in Goodstuff. About half-adozen senior figures in the agency also have share options.
Goodstuff did not disclose how the buy-back was funded but it is understood that the founders are not looking for an external shareholder or to sell in the near future.
The agency, which recently moved from Covent Garden to Tottenham Court Road, plans to expand its management team in the coming months.
Stephens cited Nielsen figures to show independent shops are in a strong position, noting that they have increased billings by 27% to £1.3bn between 2012 and 2016, while the networks boosted billings by only 12% to £7.7bn.
OMG has been streamlining its UK operations in the past year, closing M2M and launching Hearts & Science as a global network alongside OMD and PHD.