Saatchi boss meets clients to head off Charles's wrath

Charles Scott, the chief executive of Saatchi & Saatchi, has begun an urgent round of talks with leading clients in a desperate attempt to limit the damage caused by the ousted chairman's bitter letter severing his links with the company he and his brother founded 25 years ago, damning the management and shareholders for their lack of appreciation of his talents, and openly inciting clients and employees to consider their own futures.

The shares sank a further 8p to 138p yesterday and 7 million of them changed hands as investors expressed their dismay at the course of events, which the City fears could encourage Maurice Saatchi into further attempts to undermine the management and punish the shareholders for their treatment of him.

The company is still struggling to play down the dispute in public, appealing instead to the practical common sense of clients and staff, while continuing to portray Maurice Saatchi behind the scenes as a maverick who had become a liability, consistentl y promoting his own personal interests at the expense of colleagues and shareholders alike.

Specifically, it believes his diatribe ignores the contribution of the shareholders who financed the growth of the company since it went public in 1982, and shored up the business during the crisis years, culminating in 1992 when it lost almost £600m.

The shareholders who led the campaign to remove Mr Saatchi speak directly for about 30 per cent of the shares, but were supported by almost all the large shareholders, accounting for 70-80 per cent of the equity, consulted by the board in the last few weeks before the crucial vote on 15 December.

Contrary to general impression, the dissidents were also long-standing shareholders who had seen the orginal value of their shares reduced by 98 per cent as a result of the restructuring in 1992 and the rights issue in 1993.

Mr Saatchi, by contrast, has little more than 0.5 per cent of the shares. His brother Charles, who left the board two years ago, holds a similar number.

Maurice Saatchi is also accused of consistently undermining the chief executives, including Robert Louis-Dreyfus, who resigned in 1992 and especially his successor, Charles Scott, who was brought in as finance director to rescue the company and took overas chief executive from Mr Louis-Dreyfus.

The company now accepts that there is nothing to prevent Maurice Saatchi from setting up in competition with his old company or poaching clients.

But it does hold two strong bargaining cards with the former chairman, the terms of his compensation for loss of office, and non-competition and non-solicitation clauses signed by other executives which would make it difficult for him to poach them in the near future.

Maurice Saatchi has 30 months of his revised three year contract still to run at a salary of £200,000, which should entitle him to a £500,000 pay-off.

Start your day with The Independent, sign up for daily news emails
News
ebooksAn unforgettable anthology of contemporary reportage
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Digital Optimisation Executive - Marketing

£30000 - £35000 per annum: Recruitment Genius: The UK's fastest growing, multi...

Recruitment Genius: Financial Reporting Manager

£70000 - £90000 per annum: Recruitment Genius: A Financial Reporting Manager i...

Recruitment Genius: Payments Operations Assistant

£23000 - £25000 per annum: Recruitment Genius: They win lots of awards for the...

Recruitment Genius: Telephone Debt Negotiator

£13500 - £20000 per annum: Recruitment Genius: This nationwide enforcement com...

Day In a Page

On your feet! Spending at least two hours a day standing reduces the risk of heart attacks, cancer and diabetes, according to new research

On your feet!

Spending half the day standing 'reduces risk of heart attacks and cancer'
Liverpool close in on Milner signing

Liverpool close in on Milner signing

Reds baulk at Christian Benteke £32.5m release clause
With scores of surgeries closing, what hope is there for the David Cameron's promise of 5,000 more GPs and a 24/7 NHS?

The big NHS question

Why are there so few new GPs when so many want to study medicine?
Big knickers are back: Thongs ain't what they used to be

Thongs ain't what they used to be

Big knickers are back
Thurston Moore interview

Thurston Moore interview

On living in London, Sonic Youth and musical memoirs
In full bloom

In full bloom

Floral print womenswear
From leading man to Elephant Man, Bradley Cooper is terrific

From leading man to Elephant Man

Bradley Cooper is terrific
In this the person to restore our trust in the banks?

In this the person to restore our trust in the banks?

Dame Colette Bowe - interview
When do the creative juices dry up?

When do the creative juices dry up?

David Lodge thinks he knows
The 'Cher moment' happening across fashion just now

Fashion's Cher moment

Ageing beauty will always be more classy than all that booty
Thousands of teenage girls enduring debilitating illnesses after routine school cancer vaccination

Health fears over school cancer jab

Shock new Freedom of Information figures show how thousands of girls have suffered serious symptoms after routine HPV injection
Fifa President Sepp Blatter warns his opponents: 'I forgive everyone, but I don't forget'

'I forgive everyone, but I don't forget'

Fifa president Sepp Blatter issues defiant warning to opponents
Extreme summer temperatures will soon cause deaths of up to 1,700 more Britons a year, says government report

Weather warning

Extreme summer temperatures will soon cause deaths of up to 1,700 more Britons a year, says government report
LSD: Speaking to volunteer users of the drug as trials get underway to see if it cures depression and addiction

High hopes for LSD

Meet the volunteer users helping to see if it cures depression and addiction
German soldier who died fighting for UK in Battle of Waterloo should be removed from museum display and given dignified funeral, say historians

Saving Private Brandt

A Belgian museum's display of the skeleton of a soldier killed at Waterloo prompts calls for him to be given a dignified funeral