Chime Communications, the PR and marketing group, is looking to resume acquisitions as soon as markets improve with rival Brunswick believed to be on its shopping list.
In a trading update yesterday, Chime revealed it had sacked nearly 170 workers, mostly since the 11 September terrorist attacks in the US.
Lord Bell, Chime's chairman and Margaret Thatcher's former spin-doctor, said: "The management remain committed to growing both organically and through acquisition in the future."
He said the current weakness in the capital markets meant Chime's plans to buy competitors had to be put on hold.
Lord Bell would not comment on specific targets though he said that Brunswick was a "tremendous" operation. There have been a spate of stories recently suggesting that Alan Parker, the founder of Brunswick, was looking to sell the privately held business with a price tag of £100m.
Mr Parker still owns most of the firm and it has been suggested that he is looking to monetise his stake. Brunswick, which has more FTSE 100 clients than any other PR operation, declined to comment.
Industry sources believe that Lord Bell – a strong advocate of industry consolidation – would "dearly love" to buy Brunswick, which would help overseas expansion. He and Mr Parker are known to be friends although it is understood that no takeover talks have taken place. It is thought that Chime would look to pay no more than £50m for Brunswick. Chime owns Brunswick competitors Bell Pottinger and Smithfield Financial.
Separately, Mr Parker is looking for outside investors for his Cantos venture, which provides streamed pre-recorded clips of interviews with company directors to analysts and investors to accompany financial announcements.
Chime yesterday warned the second half of the current financial year would see no growth, leaving 2001 organic growth in operating profit at just 1 per cent. Lord Bell said: "I can't see a single sign of things getting better though we still aim to grow our market share."
The job cuts from the 1,100-strong workforce came mostly from Chime advertising and hi-tech PR businesses. A £6m charge will be taken to cover the lay-offs and to pay for Chime to break leases to give up 24 per cent of its office space.Reuse content