Economy

Scandal-hit Bell Pottinger hires BDO to advise on sale

Scandal-hit Bell Pottinger hires BDO to advise on sale”

Bell Pottinger's second-largest investor has walked away from the PR giant as the backlash over a secret campaign in South Africa aimed at stirring up racial tensions continues to grow.

In addition to HSBC, Clydesdale Bank, the construction company Carillion, and United Kingdom broadband operator TalkTalk all revealed on Tuesday that they had stopped working with Bell Pottinger.

An investigation by the UK's Public Relations and Communications Association (PRCA) found the campaign was likely to "inflame racial discord" in the country.

The task of selling the firm was made even harder on Tuesday after Chime, the marketing and advertising business that once owned all of Bell Pottinger, wrote off its 25 per cent share, having handed the stake back to the company for nothing in the past two weeks.

Danny Rogers, editor of PR Week, went further, claiming: "The Bell Pottinger name is now tarnished, nearly to the point of destruction". Their departure brings the number of clients to have left the PR agency in the wake of the scandal to seven.

Veteran spin doctor Chris Vick told HuffPostSA on Tuesday Bell Pottinger is "as good as dead" and shouldn't bother attempting to recover.

The Guptas have been accused of benefiting financially from their close links to Jacob Zuma, the South African president. Both have previously denied such a relationship. This was the same month that the PR firm's chief executive, James Henderson, offered an "unequivocable and absolute" apology for an "inappropriate and offensive" social media campaign.

At the time Henderson, who resigned on Sunday, also fired the director running the campaign, Victoria Geoghegan, and suspended two other employees.

This led to an extraordinary BBC Newsnight interview, in which co-founder and former Downing Street advisor Lord Bell said it was "almost certainly" the end for the firm.

As well as St James's Place, Bell Pottinger's current list of City clients includes M&A adviser Ondra Partners, stockbrokers Shore Capital, Cenkos Securities and N+1 Singer, the law firm Berwin Leighton Paisner, fintech startup Ripple and the Ontario Teachers' Pension Plan. Richard Edelman yesterday described Bell Pottinger's expulsion from the PRCA as a "proud moment for the industry", while many senior PR figures have publicly applauded the decision. The firm said earlier that it accepted there were "lessons to be learned" and that it would abide by the PRCA code of ethical conduct on a voluntary basis.

Bell Pottinger declined to comment.

"We have used Bell Pottinger for specific projects in the past but will not be doing so in the future", HSBC said in an e-mailed statement.

Due to the work it had done for Oakbay and the Gupta family, the PRCA announced that Bell Pottinger's membership had been terminated and the company has been banned for five years.



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