Spinning into oblivion: now PR leviathan Bell Pottinger has gone bust
HOW MOS BROKE THE STORY THAT SHOCKED PR WORLD
DISGRACED public relations company Bell Pottinger is set to sink into administration tomorrow, in the most spectacular fall from grace ever to hit the industry.
The collapse of the company – which was plunged into crisis after being accused of inciting racial hatred during a campaign in South Africa – will affect 270 blameless employees, as well as PR highflyers, including:
Former chief executive James Henderson, who was forced to resign over the scandal. He said this weekend he has ‘lost everything’, as his winter wedding plans were put on hold indefinitely;
Divorcee Heather Kerzner. Henderson’s fiancee is the biggest shareholder, but the stake she bought for several millions in the spring is likely to be virtually worthless;
Founder Tim Bell will lose around £1million of the severance pay he negotiated when he left the firm last year;
About 20 partners who face a collective tax bill of £700,000 that they thought had been settled by the company.
The firm’s implosion has shocked both the City and London society, as Henderson’s connections extend into showbiz, the aristocracy and Royalty. As well as City clients he has acted for Madonna and the Duchess of York, who introduced him to Ms Kerzner in 2015.
The firm collapsed after it orchestrated a ‘fake news’ campaign on behalf of the Gupta family, one of South Africa’s wealthiest dynasties.
Lord Bell, who is famed for his willingness to represent dictators such as the late Chilean leader General Pinochet, admitted he was instrumental in bringing in a lucrative £ 100,000- a- month contract from a company called Oakbay, controlled by the Guptas.
Bell Pottinger fanned flames of outrage when it embarked upon a campaign to divert attention from the Guptas’ ties with South African president Jacob Zuma.
To do so, it branded the president’s opponents as the agents of ‘white monopoly capital’, despite the fact these included other big Bell Pottinger clients such as luxury goods giant Richemont.
Industry body the Public Relations and Communications Association expelled Bell Pottinger for at least five years, saying its actions were likely to inflame racial discord.
Ms Kerzner became Bell Pottinger’s biggest shareholder in April, believing the Oakbay debacle had been resolved. She and Henderson between them own around 40 per cent of the company.
As recently as last week, she described Henderson as ‘amazing’, claiming: ‘I have never been more happy in my entire life.’ Friends say he has moved out of her Chelsea townhouse to ‘give her space’.
Ms Kerzner, who saw her investment as an act of faith in her fiance, said: ‘I’m not the first woman to back her man and I won’t be the last.’ A new date for their wedding, which had been due to take place at Claridge’s in Mayfair in November, now looks unlikely, friends say.
Henderson said this weekend he plans to start again in the PR business once the dust has settled.
Lord Bell, who is accused by his enemies of conniving in the downfall of his former company, said he will not receive any more instalments on the seven-figure payment he agreed when he left the firm.
About 270 employees will lose their jobs. One consultant said: ‘There are a lot of young people working here who are entirely blameless and now have an uncertain future.’ Henderson apologised to staff and clients and said he was ‘hugely saddened’ by events.
Lord Bell added: ‘I’m sorry about the people who have lost their jobs but I left quite a while ago.’