CAPITAL WEEKLY: HILL & KNOWLTON STEPS INTO BULGARIA

Views on BG | July 22, 2001, Sunday // 00:00

The company might acquire shares from its Bulgarian associate M3 Communications Group, Inc.

Sofia, July 2001 - The third largest PR agency in the world Hill & Knowlton (H&K) is opening an office next year in Bulgaria, announced its executive vise president Terence Billing. This will be the first direct entering of the international PR company on the Bulgarian market. At the moment H&K has an exclusive associate agreement with the Bulgarian public relations agency M3 Communications Group, Inc. (www.m3bg.com), which belongs to Maxim Behar.
There is a possibility that H&K will hold the controlling shares package of M3 Communications Group, Inc. Neither one of the parties gave an answer to this question definitely yet. “ We will continue to work together with M3, we are not planning to become competitors of this big and well established company familiar with the local market. Later on there is a option to buy shares of M3 Communications Group, Inc..” commented Terence Billing. The idea is that the Bulgarian partner should coordinate the traditional PR projects. The Sofia affiliate will work on PR projects on the Internet, which are now entering the market. The manager will be Bulgarian and at the beginning it will be coordinated by the London office of H&K. The affiliate will create a press office on the Internet, which might be accessed by a password and the journalists will be able to check the latest press releases for a certain client, a record of previous advertising and PR campaigns will be also available.
“H&K are developing the strategy of acquisition of their partners or entering into joint venture with them, because H&K prefers to be on the market with their brand. In Bulgaria both of the options are concerning the participation of M3”, explained Maxim Behar.
The communications holdings corporation WPP, who is the owner of H&K, acquired the Portuguese partner of the PR agency. “ We decided that the time had come. Recently we are negotiating for the obtaining of our Norwegian partner. The idea is H&K to have an office in each country”, Terence Billing said. According to the American council of PR companies, for year 2000 the company had USD 306 million revenue.
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July 2000 M3 Communications Group, Inc. and H&K signed a one-year contract for partnership. The contract will be automatically renewed if none of the parties has any objection. During the visit of Terence Billing in Sofia at the end of July 2001 became clear that the contract will be prolonged as both sides agreed on that. The acquirement of the Bulgarian agency is not included as an option in the contract for partnership, explained Terence Billing. He also said that H&K contacted M3 Communications Group, Inc. for its partner, after a recommendation by the vice president of the Swiss bank UBS. Among the clients of M3 are Microsoft, Cisco, Compaq, and Nokia. Few years ago the Bulgarian agency Princeps was on the negotiations for a partnership contract, but because of the fatal death of the chief executive Elena Marinova the negotiations weren’t completed.

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