Vox Pop

Last week The Fourth Room chief executive Piers Schmidt predicted that 2001 would see the sale of the last independent consultancy for £100m (News Analysis, DW 5 January). Will acquisitions continue to be a hot topic, or will design groups find other ways to broaden their repertoire? If so, what?

‘New entrants into the design world, who want to do it their way, won’t go away. So, happily, we’ll never see the last of the Independents. Will it sell for £100m? Only if it’s making £10m profits or more. With the return to some degree of business sense in the dotcom world and related sectors, the days of unbelievable deals for companies generating negligible profits are gone. The design sector will probably continue to consolidate. The merger and acquisition market may contract if there is a downturn, but there will always be a market for quality business.’

Mandy Marron, Senior Partner, Willott Kingston Smith

‘Large advertising groups continue to digest the mega-mergers of recent years. There are few sizeable UK independents left, so we are likely to see the acquisition market cool in the first part of 2001. However, the market for niche businesses with an alternative offering to the big groups will always remain strong. It will also be interesting to see the impact in the coming year of some of the smaller venture capital funds that are taking an increasing interest in investing in the design sector.’

Robert Mogford, Director, Mergers & Acquisition, BDO Stoy Hayward Corporate Finance

‘At the risk of sounding maudlin, unless something very surprising happens to the US economy, the design industry is likelier to be thinking more about consolidation than expansion this year. The industry’s long-term prospects are sound, but the short-term outlook is so uncertain, that sensible bidders will wait, for a few months at least, before plotting £100m deals.’

Alice Rawsthorn, Architecture & Design Critic, The Financial Times

‘Design can learn from football. Several clubs tried to buy success, purchasing expensive players at the expense of developing their youth team. Champion Manchester United invested in new talent and its most valuable players today come from within the club. Design groups could develop groups of independent thinkers within their organisation – the passion, loyalty and financial returns might better what’s delivered by an off-the-shelf acquisition.’

Tim Rich, Writer