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
ebooks
ebooksA celebration of British elections
  • Get to the point
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

Ashdown Group: Editor-in-chief - Financial Services - City, London

£60000 - £70000 per annum + benefits : Ashdown Group: A highly successful, glo...

Ashdown Group: Junior Application Support Analyst - Fluent German Speaker

£25000 - £30000 per annum + benefits: Ashdown Group: A global leader operating...

Guru Careers: Management Accountant

£27 - 35k + Bonus + Benefits: Guru Careers: A Management Accountant is needed ...

Guru Careers: Project Manager / Business Analyst

£40-50k + Benefits.: Guru Careers: A Project Manager / Business Analyst is nee...

Day In a Page

General Election 2015: ‘We will not sit down with Nicola Sturgeon’, says Ed Balls

'We will not sit down with Nicola Sturgeon'

In an exclusive interview, Ed Balls says he won't negotiate his first Budget with SNP MPs - even if Labour need their votes to secure its passage
VE Day 70th anniversary: How ordinary Britons celebrated the end of war in Europe

How ordinary Britons celebrated VE Day

Our perception of VE Day usually involves crowds of giddy Britons casting off the shackles of war with gay abandon. The truth was more nuanced
They came in with William Caxton's printing press, but typefaces still matter in the digital age

Typefaces still matter in the digital age

A new typeface once took years to create, now thousands are available at the click of a drop-down menu. So why do most of us still rely on the old classics, asks Meg Carter?
Discovery of 'missing link' between the two main life-forms on Earth could explain evolution of animals, say scientists

'Missing link' between Earth's two life-forms found

New microbial species tells us something about our dark past, say scientists
The Pan Am Experience is a 'flight' back to the 1970s that never takes off - at least, not literally

Pan Am Experience: A 'flight' back to the 70s

Tim Walker checks in and checks out a four-hour journey with a difference
Humans aren't alone in indulging in politics - it's everywhere in the animal world

Humans aren't alone in indulging in politics

Voting, mutual back-scratching, coups and charismatic leaders - it's everywhere in the animal world
Crisp sales are in decline - but this tasty trivia might tempt back the turncoats

Crisp sales are in decline

As a nation we're filling up on popcorn and pitta chips and forsaking their potato-based predecessors
Ronald McDonald the muse? Why Banksy, Ron English and Keith Coventry are lovin' Maccy D's

Ronald McDonald the muse

A new wave of artists is taking inspiration from the fast food chain
13 best picnic blankets

13 best picnic blankets

Dine al fresco without the grass stains and damp bottoms with something from our pick of picnic rugs
General Election 2015: Ed Miliband's unlikely journey from hapless geek to heart-throb

Miliband's unlikely journey from hapless geek to heart-throb

He was meant to be Labour's biggest handicap - but has become almost an asset
General Election 2015: A guide to the smaller parties, from the the National Health Action Party to the Church of the Militant Elvis Party

On the margins

From Militant Elvis to Women's Equality: a guide to the underdogs standing in the election
Amr Darrag: Ex-Muslim Brotherhood minister in exile still believes Egypt's military regime can be replaced with 'moderate' Islamic rule

'This is the battle of young Egypt for the future of our country'

Ex-Muslim Brotherhood minister Amr Darrag still believes the opposition can rid Egypt of its military regime and replace it with 'moderate' Islamic rule, he tells Robert Fisk
Why patients must rely less on doctors: Improving our own health is the 'blockbuster drug of the century'

Why patients must rely less on doctors

Improving our own health is the 'blockbuster drug of the century'
Sarah Lucas is the perfect artist to represent Britain at the Venice Biennale

Flesh in Venice

Sarah Lucas has filled the British pavilion at the Venice Biennale with slinky cats and casts of her female friends' private parts. It makes you proud to be a woman, says Karen Wright
11 best anti-ageing day creams

11 best anti-ageing day creams

Slow down the ageing process with one of these high-performance, hardworking anti-agers