Dubai: Bell Pottinger Middle East (BPME) announced on Sunday that it was in talks to formally separate from its embattled parent company in London via a local management buyout.
The statement follows reports on Friday that the London-based public relations agency, which has been embroiled in a scandal relating to unethical practices in South Africa since March 2017, was set to go in to administration as early as this week.
In an email sent out on Sunday morning, Tim Falconer, the managing director of Bell Pottinger’s Dubai office, said: “The Directors of Bell Pottinger Middle East based in Abu Dhabi and Dubai are pleased to announce that it is in discussions to formalise a separation from its current owner Bell Pottinger Private Limited.”
He added: “This follows the news that Bell Pottinger Private Limited in the UK is to be put into administration. As a separate legal entity, BPME is not part of these proceedings and is therefore in a position to determine its own destiny.”
Bell Pottinger was exposed earlier this year as having ran a sustained public relations campaign that sought to exacerbate racial tensions in South Africa on behalf of the Guptas, a wealthy business family with close ties to President Jacob Zuma.
The purpose of this campaign, leaked emails showed, was to portray the Guptas as victims of a racist conspiracy, in order to deflect attention from mounting accusations of state-aided corruption against the family.
In its statement, Bell Pottinger Middle East stressed that it had no involvement in the campaign for Oakbay Investments, the official name for the Gupta family business. The contract was worth upwards of £100,000 (Dh484,972) per month to Bell Pottinger Private Limited before they cancelled it in April 2017.
“[We] have been at pains to point out that at no point were UAE directors ever involved in the winning or servicing of the Oakbay account in South Africa which has led to the sad demise of the UK business. Indeed, BPME’s UAE directors actually rejected the opportunity to work on the account. This reinforces BPME’s ability and intention to continue to trade under its own banner as a separate entity,” the statement read.
Potential investors
Falconer added that the business was already receiving enquiries from a wide range of potential investors.
“The injection of fresh capital would enable us to make our business even stronger, through the acquisition of fresh talent and the addition of more services, especially in the digital arena,” Falconer said.
Both Falconer and Archie Berens, Managing Director of Bell Pottinger’s Middle East business, are currently working on a proposal with the administrators of Bell Pottinger Private Limited in the UK that would see the separation of BPME formalised and the ownership of the business transferred to its management in a management buyout.
“In many ways, this was inevitable,” said Alex Malouf, a senior communications executive and Middle East Public Relations Association (Mepra) board member.
Noting that the Middle Eastern business was completely removed from its parent company in London, Malouf told Gulf News that it was logical the company would want to separate.
“The Middle East business was not involved with what happened in South Africa … they are independent from London. It makes sense that they’d want to move away from them, but they have to be transparent and draw a line in the sand, and say ‘We’re not the same business as London,’” he added.
