Cheil Worldwide solidified its global presence in the advertising world with the $50 million purchase of North Carolina-based McKinney. According to Tanzina Vega of the New York Times, McKinney will keep its name, but with the purchase, the successful advertising company becomes part of Cheil Americas. The New York Times quoted from an e‑mail statement from Cheil Worldwide chief executive, Nack-Hoi Kim. The purchase represents the beginning of the “next chapter in the company’s transformation into a global network made of the best local ad agencies.”
Cheil Seeking to Bolster US Presence
Mr. Kim continued the e‑mail by explaining that “McKinney is one of the best advertising agencies in the world’s largest advertising market. Their highly creative, integrated approach is recognized as the most effective in the world.” McKinney was formerly part of Havas, another global advertising holding company, until 2008 when it bought itself back. Cheil was formerly owned by Samsung and has struggled to create a solid, visible presence in the United States.
Two Prize-Winning Advertising Companies Come Together
If McKinney wasn’t well-known to Americans, all of that changed in April of 2012 when the company went up against Culver City, California-based WDCW LA (Wong Doody Crandall, Wiener,) on the AMC (American Movie Classics,) television show, The Pitch. McKinney won the competition and created the best advertising campaign for Subway® restaurants breakfast sandwiches. Cheil Worldwide was also successful in winning the Media Grand Prix award at the Cannes Awards in June of 2011. As Brad W. Brinegar, McKinney’s chairman and chief executive observed, “who would ever have thought a global network would lead out of Durham, North Carolina, and who would have thought that a Seoul agency would have been the dominant force at the Cannes awards.?”
Cheil Approached McKinney
Cheil global chief operating officer, Michael Kim may unknowingly have hinted at the future when he predicted that 2012 would be a “transformative year” in a December 2011 interview with the New York Times. In discussing the merger, Brinegar explained the reasoning behind Cheil’s desire to purchase McKinney. He said, “Cheil came to us seeking a partner to complete their global network. They have the resources to help us develop some of the capabilities that would have taken us longer to develop had we remained independent.”
Cheil Americas president and chief executive, Buz Sawyer explained, however, that McKinney would “retain its independent spirit.” He went on to clarity that “Cheil is not a holding company. Cheil is an advertising agency.”
The take over brings together two dominant players in global advertising. McKinney will help Cheil increase and expand its presence in the United States, while Cheil Worldwide will provide McKinney with the resources that it needs to grow.