(Promo) J. Brown Agency has laid off staff as parent Grey Global Group prepares to be sold.
J. Brown let go as many as 40 staffers last week as part of a “reorganization to fine-tune our infrastructure,” said CEO Tim Dorgan.
Dorgan declined comment on the number of staff laid off, but said 40 (about 40% of its 100-person staff) is “exaggerated.” The agency is hiring in Chicago and Stamford as part of its retooling, he added.
J. Brown’s reorganization is unrelated to Grey’s sale, and new ownership for Grey will not affect J. Brown’s restructuring plans, Dorgan said.
There had been speculation that J. Brown had cut staff in an effort to improve Grey’s financial performance for potential bidders. However, there have been no layoffs at other Grey divisions, and J. Brown is a small percentage of Grey’s total billings, so layoffs at J. Brown would have little impact on Grey’s total balance sheet.
Dorgan said the layoffs also are unrelated to the abrupt Aug. 25 departure of Jon Kramer as CEO of the Stamford, CT-based agency. Dorgan, who had been president of J. Brown’s Chicago office for the last 18 months, replaced Kramer as CEO, and will remain in Chicago. Executive vice president Vince Weiner was named president of the Stamford, CT office.
New York City-based Grey is expected to fetch $1.3 billion to $1.5 billion. WPP Group, Havas and private-equity firm Hellman & Friedman are likely bidders. Final bids are expected next week, with a decision likely by mid-October and the transaction expected to be completed by the end of the year. Grey has said that it won’t sell off individual businesses. Grey hired Goldman Sachs & Co. and JP Morgan earlier this year to facilitate the sale.
J. Brown ranked No. 30 in the 2004 PROMO 100, with estimated 2003 net revenues of $30 million. Top clients include Procter & Gamble and Kraft Foods.
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