NEWS: Chime acquires KBH
Sir Tim Bell’s quoted PR firm Chime Communications is buying KBH Communications for £500,000 cash and merging it with Lowe Bell Good Relations, the revamped version of subsidiary Good Relations. KBH, which lists The All England Lawn Tennis Club and Classic FM among its clients, was founded in 1984 by Keith Hopkins.
The group employs 11 people at its offices in Kensington, London. These will now move to LBGR’s Russell Square offices. In the year ending September 1995, KBH’s pre-tax profits were £70,000. After exceptional items they stood at £35,000 on a turnover of just under £1 million. KBH has net assets of nearly £50,000. Under the terms of the deal, Hopkins, 66, will join Lowe Bell Good Relations as deputy chairman on a three-year contract and Simon Pearson, a KBH director, will join LBGR’s board of directors. Hopkins will personally get about 80 percent of the cash being paid for his firm.
He said: ‘KBH is joining the Lowe Bell group at a time when it is expanding and I’m really looking forward to joining the board. It’s a brilliant deal for our people and I hope to make a massive contribution.’
City analysts appear to believe Bell has paid a fair price for KBH, though one expressed concern about its operating margins which he feared were rather low.
‘Rubbish,’ said Bell. ‘We express profits as a percentage of our fee income and on that basis we estimate that KBH’s profit margins are about 12.5 per cent. That’s just below our own which stand at about 14 per cent.’
Sir Tim said Chime would continue with its expansion plans and is looking to see a growth of about ten to 15 percent per year. But he said the firm would not try to build an international network.