Spin into oblivion: PR leviathan Bell Pottinger goes bust

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 company was plunged into crisis after being accused of inciting racial hatred during a campaign in South Africa.

The collapse will affect 270 blameless employees as well as PR highflyers.

They include former chief executive James Henderson, who was forced to resign over the scandal. He said this weekend he had ‘lost everything’, as his winter wedding plans were put on hold indefinitely.

Heather Kerzner, Henderson’s fiancée, is the biggest shareholder but the stake she bought for several millions in the spring is likely to be virtually worthless now.

Founder Tim Bell will lose around £1 million of the severance pay he negotiated when he left the firm last year and around 20 partners face a collective tax bill of £700,000 that they thought had been settled by the firm.

The company’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 orches- trated a ‘fake news’ campaign on behalf of the Gupta family, which is 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 £100,000a-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.

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 own around 40 per cent of the company between them.

Friends say he has moved out of her Chelsea townhouse to ‘give her space’.

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 has apologised to staff and clients and said he was ‘hugely saddened’ by events.

‘Orchestrated fake news campaign’