Interpublic Group takes majority stake in Addis/Wechsler
New York-based holding company Interpublic Group — which owns several ad agencies including McCann-Erickson and tallied about $18 billion in billings last year — has acquired a majority stake in 8-year-old film and TV management and production company Addis/Wechsler.
The agreement marks the first of its kind in the entertainment industry.
Negotiations between IPG chairman and CEO Philip Geier Jr. and Addis/Wechsler principals Keith Addis and Nick Wechsler have been ongoing since January. Terms of the deal were not disclosed, but it is believed Interpublic purchased a 51% stake for an estimated $25 million to $30 million.
In addition, Addis/Wechsler — which recently signed a two-year, first-look deal with Universal Studios for film — is in talks to close a first-look TV deal. Columbia TriStar Television is said to be a leading candidate.
With the Interpublic deal in place, Addis/Wechsler will now move significantly into TV packaging and production, following other talent rep firms such as Brillstein-Grey, Sandollar and Three Arts Entertainment.
Although Addis/Wechsler produced a pilot, “The Player,” and the recent DreamWorks series “Ink,” it does not yet have a major presence in television. Addis/Wechsler is expected to hire more executives to work on television development.
Interpublic Group, which was the first ad agency to go public, had been anxious to align with an entertainment company in order to develop programming and tap into a talent base much like Cincinnati-based Procter & Gamble has done with Paramount and Sony.
The deal comes after Interpublic kicked the tires of several other entertainment entities, including talent agency UTA last year (Daily Variety, Dec. 9). Privately owned ad agency Young & Rubicam has also been interested in acquiring or aligning itself with a talent agency to implement a similar strategy.
The deal came about after former ICM and CAA agent Steve Carbone, now a consultant, introduced the principals of both companies and initiated talks. Negotiations began to get serious in March and April of this year.
IPG is the holding company of ad agency McCann-Erickson, the agency of record for the Coca-Cola Co. Also included under IPG’s umbrella is Ammirati & Puris Lintas and the Lowe Group.
Interpublic handles the accounts of some of the world’s biggest advertisers, such as Unilever, General Motors, Mercedes-Benz and Nestle. In essence, Interpublic will now be able to provide its key corporate clients sponsorship and ownership possibilities in programming.
Specifically, the idea is to design niche or what is being called “purpose-built” programming for key clients. In other words, building a show customized to a corporate client’s needs.
IPG’s Geier has long maintained that the proliferation of media has had a profound effect on audience fragmentation worldwide.
“In the last three years, we’ve been trying to find ways to get involved in targeted content,” he told Daily Variety Tuesday. “By doing this now, we can develop relationships that can help our clients. We’re always trying to push the envelope.” The company was the first to put U.S. gameshow formats such as “Wheel of Fortune” and “Jeopardy!” into Europe before IPG’s Fremantle Intl. distribution arm merged with All American.
Interpublic also has an equity stake in All American Communications, which in turn owns Goodson/Todman, which produces syndicated programming and gameshows such as “The Price Is Right.” It also has an equity stake in Atlantis Releasing, a television production company in Toronto. The company also owns Western Intl. Media, the largest media buyer and planner in the country, which buys for the Walt Disney Co. IPG’s assets also include Florida-based Alton Communications, a small television production concern.
The deal raises some guild rule questions that basically state that no production company can own a talent agency, but the management world is for the most part unregulated. It is unclear how the guild rules will apply to a holding company that owns a television production arm.
For Addis/Wechsler, the move pumps in a substantial amount of cash to the company and its two principals.
The management company represents such talent as Leonardo DiCaprio, Claire Danes, Samuel L. Jackson, Billy Bob Thornton, Cameron Diaz, Stephen Rea, Jack Lemmon, Cary Elwes, Richard Dreyfuss, Jeff Goldblum, Steve Buscemi, Ted Danson, Anthony LaPaglia, Christine Lahti, Sam Waterston, Ron Silver and Kyle MacLachlan.
Addis/Wechsler has produced such films as Steve Soderbergh’s “sex, lies and videotape,” Gus Van Sant’s “Drugstore Cowboy,” Robert Altman’s “The Player,” Michael Tolkin’s “The New Age” and “The Rapture,” James Gray’s “Little Odessa” and Steve Buscemi’s “Trees Lounge.” Both “Eve’s Bayou,” which stars Jackson, and “Polish Wedding” are in post-production.
Addis/Wechsler also has several projects in development, including “The Sparrow” with Antonio Banderas; “Metabarons” with helmer Alfonso Arau; Beeban Kidron’s “Random Acts of Senseless Violence”; Douglas Wright’s “Quills,” with helmer Des McAnuff; “Tesla,” about the Serbian inventor; and David Hoag’s “Machiavelli.”