Sibling agencies UM and Initiative will fall under the umbrella positioning of the holding company, IPG Media, which is expected to strengthen the group’s bargaining power with media owners.
“The purpose of IPG Media in both countries will be to affect a series of internal organisational changes to strengthen and sharpen IPG’s overall media capabilities,” said a spokesman for Initiative and UM.
“From the outset, IPG Media will be taking collaborative steps on the progress of various businesses, while maintaining each entity as separate and, sometimes, competing brands.”
Ram Subramanium, technical advisor of Initiative Jakarta, will assume oversight of IPG Media. Management has yet to be named for Initiative.
Meanwhile, Gaurav Bhasin, CEO of UM Malaysia, will now become CEO of IPG Media Malaysia. Chew Kagee and Gurpreet Singh have been appointed as GMs of UM and Initiative Malay-sia, respectively. The offices in Malaysia will remain in separate buildings, but it is understood that in Indonesia, UM’s physical office has shut down.
Despite an official announcement that UM and Initiative will still co-exist in Indonesia, late last month an internal announcement was made to UM’s 18 remaining staff that most would be retrenched. Remaining accounts and resources have temporarily shifted to Initiative. Sources have pointed to the recent loss of XL Telekom to Dentsu, a US$20 million account, as the trigger for UM Jakarta’s demise.
Last year, UM Jakarta also lost its two biggest local clients — Pizza Hut and Bentoel cigarettes, worth US$90 million — to GroupM.
David Morgan, president, UM Asia-Pacific, was not available for comment.
