Merger creates lobbying giant

Date: 14/12/1995

By Tim Jones

THE merger of public affairs companies Market Access Europe (MAE) and GPC Government Policy Consultants will create Brussels' largest lobbying firm from January.

The new company, to be called GPC Market Access Europe, will have combined sales revenue of 3.5 million ecu and a total staff of 30, outstripping other big players like Hill & Knowlton and Burson-Marsteller.

“It's a pre-emptive move,” said the combined companys' new Executive Chairman John Houston. “We believe that the market is becoming ever more sophisticated, as are the demands of clients. We believe by doing this we will be ahead of the game.”

While other lobbyists do not know the inside reasons for the merger, they believe it was carried out from a position of strength, rather than as a result of the kind of retrenchment witnessed in Brussels in the past few years.

From the beginning of the decade, the number of lobbyists and specialist public affairs firms has swelled and the industry now employs more than 10,000 people. The saturation of the market led to some

shut-downs and the scaling back of at least four previously dominant UK firms.

“There is going to be a move towards networks among the public affairs companies,” said one lobbyist. “The bigger firms would be happy with that.” Even merging operations, but keeping the same number of staff, provides opportunities to reduce costs, particularly at a time when the price of office space is falling.

The advantage that MAE and GPC have is that they have the security of a large public relations firm behind them. Both are partially controlled by US giant Omnicom, which owns advertising companies BBDO and DDB Needham.

Having taken a stake in GPC, Omnicom bought a share in MAE in August last year. Until then, MAE had been owned by Market Access in London with senior local staff holding equity stakes. The two Brussels firms then started to wonder whether to keep their brand names or merge.

“Both options were open to us and we simply decided for positive reasons - because of the market place - we would merge in Brussels,” said Houston. “We've done it because we think this is the way to offer clients the best possible service and to secure the critical mass needed for specialisation and in-depth services in Brussels as well as to develop a Europe-wide network.”

The firms believe they can complement each others' work, even though they have a similar kind of clientele: multinationals and trade associations. They specialise, however, in different areas. MAE has built a reputation in institutional affairs, financial services, pharmaceuticals, food and drink and audio-visual policy. Recently, it has been involved in campaigns over packaging, the Investment Services Directive, additives and sweeteners and time-sharing. GPC boasts expertise in environmental and chemical issues, under Howard Forte and Caroline Wunnerlich.

While believing the merger to be positive for MAE, of course, Houston thought it would offer few examples to other lobbying companies. “This is a merger of two of the leading three firms so the scope for others to match what we have done will be difficult.”