Unilever Objects To Groupm Co-Pitching For P&G Business

Unilever objects to GroupM co-pitching for P&G business

Mumbai: WPP Group’s media specialist company GroupM has landed itself in a sticky situationвЂ"the nation’s top advertiser, Hindustan Unilever Ltd (HUL), has reportedly threatened to pull out its business from Group M if its subsidiary wins the joint bid to manage Procter and Gamble Co.’s (P&G) media planning and buying business. And if GroupM backs out of the P&G bid at this stage, it could result in the loss of business it handles for the consumer goods company in other markets.

Media circles have been buzzing in recent times over GroupM India Pvt. Ltd and rival Madison Communications Pvt. Ltd jointly pitching for P&G’s media business, which was up for review after seven years. This move had signaled a possible joint venture (JV) between the two companies, involving some equity sharing arrangement, said media buyers. GroupM’s pitch was made from its Mediacom Pvt. Ltd company against media specialists such as Starcom MediaVest Group and Carat Media Services India Pvt. Ltd and the results are due any time soon.

India’s top advertiser, Hind Unilever that owns brands such as Lux, may pull out its business from GroupM if the latter’s arm wins the joint bid to manage P&G’s media planning and buying biz

HUL’s parent Unilever Ltd, the arch-rival of P&G in the packaged goods sector, has raised objections at the regional level over a GroupM company co-pitching for P&G business since GroupM’s Mindshare India handles HUL’s media business, says a person close to the development.

Unilever sees a potential business conflict, though the pitch was made out of Mediacom that does not handle any HUL business. Unilever’s regional office has reportedly voiced concerns on client confidentiality with GroupM’s top brass, adds the person.

As per industry estimates, HUL spent Rs1,137 crore on TV and print advertising in 2007, while P&G’s share in India was Rs235 crore.

Bharat V. Patel, chairman of Procter and Gamble Hygiene and Health Care Ltd, said the results of the media pitch are due any day now. He declined to comment on Unilever issues and GroupM’s participation. “As per company policy, we do not respond to speculation,” said a company spokesperson.

The company’s brief for the bidders was to provide strategic planning inputs on two of its brands, Gillette and Head & Shoulders, say media buyers.

Madison’s chairman and managing director Sam Balsara declined to comment, while an HUL spokesperson did not answer emails and could not be reached over the phone. GroupM India chief executive Vikram Sakhuja, too, did not respond to emails, while Mediacom MD Divya Gururaj said the firm