Local Ad Agency to Merge With Bozell : Deal: Costa Mesa-based Salvati Montgomery Sakoda gains a worldwide network and access to specialized services. No layoffs are expected.
Salvati Montgomery Sakoda, one of Orange County’s largest independent advertising agencies, said Monday that it has agreed to merge with one of the industry’s biggest companies, Bozell Worldwide.
The transaction marks the second time that Bozell has established a foothold in Orange County, where a number of major agencies have come and gone.
The deal merges Salvati’s 50-member office with the 70-member staff of Bozell’s Los Angeles office. No layoffs are expected, Bozell said, but the Los Angeles office will move 40 account servicing, creative and media employees to Costa Mesa to serve two clients, Rockwell International Corp. in Seal Beach and Asics Tiger in Fountain Valley.
The Orange County office will be renamed Bozell/SMS, and its president, Phil Salvati, will report to Mel Newhoff, general manager of Bozell’s Los Angeles office.
Bozell, the nation’s 15th largest ad agency, approached Salvati Montgomery Sakoda a year ago with an offer, Salvati said.
“One of the ways Bozell has grown is through mergers and acquisitions,” Newhoff said. “Salvati has one of the best agencies in Southern California, very creative. And there were no account conflicts.”
For its part, Salvati said, his agency gains a worldwide network and access to specialized services such as direct response advertising, infomercials and help in reaching the Latino consumer.
“A major concern was that our current client base would benefit,” said Salvati. “Advertising needs today are much broader. Not all dollars are going to mass media.”
Salvati, with annual billings of $38 million, represents PacTel Cellular, Taylor Made Golf Co., IHOP Corporation, Yamaha Electronics and Keyboards, Koll International and The Times Orange County.
Bozell, which bills $1.5 billion and has 84 offices in 49 countries, represents American Airlines, Chrysler Corp., Kawasaki Motors and Buena Vista Home Video, a division of the Walt Disney Co.
A string of national ad agencies have come and gone from Orange County, including Saatchi & Saatchi, BBDO, McCann Erickson and Burston-Marsteller. The three that have endured--Foote, Cone & Belding, Backer Spielvogel Bates and Grey Advertising--represent foreign car makers.
Bozell itself established a branch office in Irvine in 1979 when it represented a large number of builders. It pulled out by 1985.
“The economy changed their reason for residing here,” said Bill Fawcett, who brought Bozell into the county when he sold Fawcett Advertising to the giant in 1979. “Orange County in the last 10 years has become more diversified. It’s not such a real estate-oriented culture.”
Fawcett retired in 1980 after accepting what he called a “very lucrative” buyout from Bozell. He has since opened an infomercial production company.
Salvati, Scott Montgomery and Ken Sakoda, however, say they are staying with Bozell/SMS. Without them, observers said, the agency would lose the personality it has built over its 12 years in business.
