PR GIANT OMNICOM
CHIEF DUCKS MEDIA?
John Wren, CEO of Omnicom
Photo by: Michael J.N. Bowles
OMC’s Wren Ducks Reporter at
Annual Meeting in Denver
John Wren, CEO of Omnicom,
rebuffed a reporter
who tried to ask questions
at the annual meeting
May 22 in Denver.
Thurs., May 24
WREN DUCKS PRESS IN DENVER
An attempt by a local reporter to question Omnicom CEO John Wren at the annual meeting in Denver May 24 was rebuffed by OMC executives.
Wren’s habit in recent years has been to avoid questions from reporters at the annual meeting.
He and the board stopped holding the meeting in New York in 2002. Reporters from this website, the Wall Street Journal and Advertising Age would attend the meeting and ask questions.
Attempts by this website to hire reporters who would question Wren in such cities as Los Angeles, San Francisco, Atlanta and Dallas have been mostly unsuccessful.
OMC’s PR units, including Fleishman-Hillard, Ketchum and Porter Novelli, billed about $1.2 billion in 2006, making OMC the largest owner of PR.
OMC does not have its own full time PR person but uses Patricia Sloan of its DDB unit when needed. She was formerly New York editor of Ad Age.
A reporter hired by this website was able to ask two questions of Wren in Dallas in 2005 before he was cut off by an OMC staffer who told him to stop using a camera.
The reporter replied it was not a camera but a digital recorder. A motion to adjourn the meeting was made during this interchange and the reporter was not allowed to ask any more questions.
A total of 15 questions had been given to the reporter who held the proxy of the O’Dwyer Co. and had the right to question Wren.
Wren was paid $13.2 million in 2006 and owns 486,086 shares worth $50 million. Options on 1.5 million shares at $79.50 became exercisable on April 4, giving him a potential immediate profit of about $30 million since OMC is currently trading at $102.
This website supplied the O’Dwyer proxy to reporter Beth Potter of the Denver Business Journal with the suggested question to Wren of: “How do you justify your compensation when OMC is still below its high of $107 on Dec. 17, 1999?”
Potter said that when she got to the room at The Integer Group-Denver, an OMC agency, someone told her the public part of the meeting was over and no questions could be allowed since the board had to go into a meeting.
An e-mail and phone messages were left with the business desk of the Denver Post about the OMC meeting but no responses were received.
Integer’s website describes Integer as “America’s fourth largest promotional agency.” It has 800 employees and other offices in Des Moines, Dallas, Cleveland and New York. Jeremy Pagden is CEO of The Integer Group-Corporate.
Federal Judge John Keenan earlier this month “certified” a class action lawsuit filed against OMC related to its dot-com investment losses.
The plaintiffs cite investment losses during the period from Feb. 20, 2001 to June 11, 2002. OMC is accused of failing to deduct about $89 million from its earnings in the first half of 2001 caused by declines in the value of its dot-com investments. Earnings reported for that half were $246M.
OMC allegedly off-loaded the shares for its dot-com companies to sham entities to avoid reporting the loss. The company has denied the charges.
A WSJ story June 12, 2002 resulted in the stock falling from the $70's to the $30's. It recovered over the next year.
Wren is known for keeping press contact to a minimum. He has granted four interviews in the past five years and discussion of financial topics was absent from each one.
Analysts say the $3.1 billion debt of OMC is among factors holding down the stock.
OMC has been buying back its own stock in order to maintain its price. It has reduced the float from 187 million to 167 million shares and Lehman Brothers is predicting it will spend $826M in 2007 and $874M in 2008 for share buybacks. It has already spent $451M on buybacks in the first quarter of 2007.
The New York Post ran a column by Christopher Byron Aug. 14, 2006 headlined “Buyback Blarney” which had the subhead: “Omnicom is pouring billions into goosing its stock.” Byron said buyback programs can backfire. The price of the stock may go up but with fewer shares out, the overall value of the company remains the same, he said.
OMC borrowed nearly $1 billion in 2006 to help with the purchases.New York Post real estate columnist Lois Weiss on May 8 said OMC has shown an interest in 650,000 sq. ft. of office space at 100 Church st. (downtown) “that have been languishing on the market.” OMC has been “making the vacancy rounds with its long-time brokers Howard Wendy and Lee Feld of WF Realty,” said Weiss. WF Realty wouldn’t comment on possible tenants.
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