Bell Pottinger: Disgraced British PR firm ‘could go into administration as early as next week’

Bell Pottinger’s Asian unit will reportedly be separated from the British parent company and will soon start trading under the name Klareco Communications

The PRCA launched an investigation into Bell Pottinger following a complaint from South Africa’s main opposition party, the Democratic Alliance (Reuters)

The UK business of disgraced London public relations firm Bell Pottinger could reportedly go into administration as early as next week.

The company, which was this week stripped of its membership of the industry’s trade association after an investigation into its conduct in South Africa, said that “all options are still being considered” when contacted by The Independent, declining to comment further.

Several newspapers reported that an announcement had been made to UK staff on Thursday night, saying the firm could go into administration next week.

The BBC reported that Bell Pottinger’s Asian unit would soon start trading under the name Klareco Communications.

It is understood that the company had been haemorrhaging clients and a major shareholder last month wrote off its stake in the group. The Public Relations and Communications Association (PRCA) on Tuesday said that Bell Pottinger had “brought the PR and communications industry into disrepute” with a campaign in South Africa that was accused of stirring up racial tensions.

Bell Pottinger’s clients had ranged from multinational businesses to governments, public sector organisations, entrepreneurs and some of the world’s richest individuals.

The accusations relate to Bell Pottinger’s relationship with Oakbay, a company controlled by the wealthy Gupta family of Indian-born businessmen, which has widely been accused of exerting undue influence over South African President Jacob Zuma.

The PRCA launched an investigation into Bell Pottinger following a complaint from South Africa’s main opposition party, the Democratic Alliance (DA). The DA blamed the PR company of working to “divide and conquer the South African public by exploiting racial tensions in a bid to keep Jacob Zuma and the ANC in power”.

The allegations reportedly stemmed from leaked emails that suggested Bell Pottinger had worked with Oakbay to create a “narrative that grabs the attention of the grassroots population”.

Bell Pottinger left the Oakbay account in April, and in July the group said that it had fired one partner and suspended another, as well as two other employees, as a result of the campaign.

Bell Pottinger’s chief executive James Henderson, who at the time said that he was “deeply sorry that this happened”, resigned earlier this month.

Earlier this week, the PRCA said that it had “imposed its most serious sanctions on Bell Pottinger”. It stripped the firm of membership and said that the group would not be eligible to reapply for corporate membership for a minimum period of five years.

In response to the decision, Bell Pottinger said it “accepts that there are lessons to be learned but disputes the basis on which the ruling was made” and said that it would “refocus on delivering outstanding work for our clients and looking after our people”.

Earlier this week, co-founder Timothy Bell, who left the firm last year, told BBC’s Newsnight programme that he thought the agency is unlikely to survive.

“It’s probably nearing the end,” Lord Bell said.