Top PR firm in 'super-agency' link-up
02/05/2006 - 11:47:16

One of the Norths leading PR companies, Citygate SMARTS, has joined forces with three others in Britain to create a new super-agency, it was announced today.

Media Square, one of the UKs fastest growing communications groups, announced four of its leading agencies had merged to create the single agency focusing on PR, marketing and design.

Holywood, Co Down-based Citygate SMARTS has linked up with IAS in Manchester, Catalyst in London and interactive agency River.

The merged business will operate as IAS Smarts plc, with the Northern Ireland business becoming IAS Smarts [Northern Ireland] Ltd.

Pippa Arlow and Leontia Fetherston, joint managing directors of the Northern Ireland company said: Media Square is one of the fastest growing UK-quoted marketing companies and its decision to create one super-agency in marketing services boosts our capacity locally as well as enabling the new company to make use of the experience and talent that we have developed over the years in Northern Ireland.

The new company will have annual revenues of 11m (16m) and a network of six offices in London, Birmingham, Manchester, Scotland and the North.

The merger also gives IAS Smarts partnership in the BBN, a global agency network with offices in 25 countries.

The new super-agency is based on what it called a Centres-of-Excellence strategy, under which each location would retain its normal business, but also deliver specialist expertise to the network to provide seamless, multi-disciplined full solutions campaigns.

In the North, IAS Smarts has a range of local and national blue-chip clients including AXA, Bank of Ireland, British Airways, Coca-Cola Bottlers [Ulster Ltd], Diageo, the Dairy Council for Northern Ireland, the International Fund for Ireland and Yell.

hope these start moVing soon bought in at 28p and 31p march 05,oh dear .neVer again.

there has been some good news posted in recent months but there is no movement at all, its so annoying!

Certainly seems like there's a turn around going on here. May take a while but for those prepared to wait there should be some decent profit to be had.

Buy Media Square at 23p
Says Rob Cullum from Trendwatch.co.uk

Marketing services group Media Square was once just another cash shell in the vast dot-com ocean of a few short years ago. But in 2002, amidst the clatter of collapsing dot-coms, came news that saved the company from the same fate: its merger with Equanim, a marketing communications specialist. The driving force behind Equanim, and now the driving force behind Media Square itself, was and is one Jeremy Middleton, who became chief executive following the merger, and remains so today.



Under Mr Middleton, a remarkable expansion began to unfold. Early in 2003 a bold piece of opportunism saw the corporate flag raised in both Leeds and Manchester as the company acquired three more businesses: two from a retreating French concern, and one more from Mr Middleton, all of them operating in both traditional and internet marketing services. The transactions were part-financed by a 125,000 pounds loan from Mr. Middleton, to match a similar advance by privately owned Pertemps Group, another major Media Square shareholder.

The pattern of acquisitions, restructurings, closures of non-performing businesses and big pre-tax losses caused by heavy amortisation, impairment and exceptional losses continued during 2003 when it gradually became apparent that a group of perceived quality was emerging. So much so that it had little difficulty in raising 3 million pounds at 8p per share; 2.4 million pounds from institutional investors and the rest from the board.

The value of investments can go down as well as up. Investing in equities can lose you part or all of your capital. Smaller company shares can be relatively illiquid and thus hard to trade. And that makes such investments more of a high risk than larger company shares. UK-Analyst.com is owned by t1ps.com, which is authorised and regulated by the FSA and can be contacted at 49 Rivington St, London EC2A 3QB or on 0207 033 9389.

What was it that these mandarins heard that opened their chequebooks so readily? Well, it was probably its decision to pick up the failed undertaking of another marketing services support business one with more than 4 million pounds sales for just 0.5 million pounds. Furthermore, a big chunk of those sales emanated from the home shopping sector, an area of key importance to the Media Square strategy.

The October 2003 full-year figures lagged behind events, but at last the company recorded a maiden profit of 0.25 million pounds pre-tax on sales of more than 8 million pounds plus 2 million pounds in the bank. In February 2004 it snapped up Leeds-based Hudson Advertising - together with its valuable home shopping and direct sales-related turnover of 2.6 million pounds. Leeds and Manchester are the primary locations in the UK for the home-shopping industry. Media Square is heavily represented in both locations.

The company had by then formed a specialist division to handle home shopping. In essence, Media Square provides its customers with the ability to outsource the troublesome tasks that lie at the heart of their operations the production of a never-ending stream of promotional material. Whether in hard copy or electronic form, Media Square offers its customers the prospect of removing the headaches and gaining a quicker time to market at a lower cost. Its weaponry is that of expertise, motivation and, for purchasing, that of scale.

The first of two transformational step-changes followed. In October 2004, fellow AIM-quoted retail communications business Coutts agreed to a 150p cash bid worth 22 million pounds. About one-third of the purchase price, 7 million pounds, was clawed back through the sale of a manufacturing site. A few days later, another 3 million pounds up-front sale of Coutts' packaging subsidiary left Media Square with the juicy core that it had sought the point-of-sale expertise and contacts and it had 5 million pounds of freehold property on its enlarged balance sheet.

A full analysis of the Standard Life New Issue + Details on all the hottest IPOs for less than 20 pounds a year!

Then, in November last year, the big one so big that, under AIM rules, it was classified as a reverse takeover. It bought the 16 marketing services businesses of fully listed Huntsworth for 63 million pounds, lifting its annual sales from 60 million pounds to 200 million pounds. The acquisition was financed by a further funding exercise of 30 million pounds at 25p per share plus a 40 million pounds debt-financing facility.


Thus, in just over 5 years, Jeremy Middleton and his team had transformed Media Square from a struggling cash shell to the UKs fifth-largest quoted marketing services and communications group, servicing more than 2,500 clients and employing 1,700 people worldwide.

Of course, size isnt everything. What counts is success. Fortunately, the news is reassuring. In April, it released a trading statement for what will be the 16-month period that ended in February. The integration of the acquisitions is substantially complete, and Huntsworths lagging former subsidiaries, were delivering swift and pleasing change for the better. Thanks to a strong flow of new business wins, all the constituent elements were trading in line with expectations, whilst net debt had dropped. Kelvin MacKenzie, best known for his controversial editorship of the Sun from 1981 to 1993, had by then become the non-executive chairman.

The recent trend towards movement of advertising and marketing resources from above-the-line (conventional advertising on TV, radio, magazines, newspapers and the internet) to a vast array of more precisely-targeted below the line services is well documented. The present benign economic environment should provide the conditions necessary for growth. The risk is that client spending will probably wilt fast if consumption tails off significantly. This, coupled with the necessity to rely upon talented individuals who can and do move, and take clients with them, has made us chary about the sector in the past.

But if Mr Middleton can combine the gravitas that he has established with an at the sharp end, investors should expect to benefit. He now commands a sizeable array of differentiated but related activities, large enough to ensure a degree of stability, but small enough to respond to good leadership.

The shares have remained subdued since the Huntsworth coup, the market keeping a watchful eye. The forthcoming full-year report, to be published on 20 July, will be more revealing than the actual figures but we expect that the 2p EPS forecast for February 2007 will be met. If were right, this would mean an earnings multiple of just over 10 times, very fair value given the range of quality businesses now under one roof, and the great opportunities for both overhead reduction and cross-selling.

Back in April, when the share price was much the same as now, independent broker Bridgewell confirmed our positive view of managements strong track record. Bridgewell sees upside of 30%, which would still leave the company at a 10% discount to its peers. BUY

Key Data

EPIC: MSQ
NMS: 15,000
Spread: 22.75p 23.25p
Market Cap: 74.8 million pounds

Bought in this morning...(small time but will top when I can)... onwards and upwards !

Keep your eye on this one as some very large trades over market price going through.

Very interesting news yesterday with regarding the buyer.

as you say , very interesting, at price paid I would ask who sold them? Must have been large holder, but no news on someone declaring sale of interest. Maybe that will follow in due course

Answer MF Global see RNS 14/5/08

thanks, missed that RNS somehow

article from todays telegraph Media Square, the struggling marketing communications group, moved up 2pc to 5.625p after Prime Active Capital, an Irish special situations investor, revealed that it had taken a 15pc stake.


Prime Active Capital, which is led by Irish financier Peter Lynch, built up the stake through contracts-for-difference broker MF Global.

Roger Parry, executive chairman of Media Square, said that Mr Lynch told him he thought the company was "undervalued".

"I welcome any shareholder who buys into the turnaround story," said Mr Parry, a former journalist who also chairs Johnston Press, YouGov, Future, and Mobile Streams.

"Everybody is in the same boat. We all want it to be successful. And in a turnround it's easier if you have four or five big shareholders, because they'll give you stability

Thanks to Markie

Media Square, the struggling marketing communications group, moved up 2pc to 5.625p after Prime Active Capital, an Irish special situations investor, revealed that it had taken a 15pc stake.


Prime Active Capital, which is led by Irish financier Peter Lynch, built up the stake through contracts-for-difference broker MF Global.

Roger Parry, executive chairman of Media Square, said that Mr Lynch told him he thought the company was "undervalued".

"I welcome any shareholder who buys into the turnaround story," said Mr Parry, a former journalist who also chairs Johnston Press, YouGov, Future, and Mobile Streams.

"Everybody is in the same boat. We all want it to be successful. And in a turnround it's easier if you have four or five big shareholders, because they'll give you stability."

4% bought at 20% premium to mid price today.

Bob Morton trebles his stake at a big premium, he's a shrewd judge and
that means this stock is a great recovery play, but very hard to buy any
size without paying a premium but i see 30-40p before the year is out.