Simon Curran, co-founder and chief executive of Shine. Photo / Supplied
Kiwi marketing company Shine is no longer an independent agency.
The company, founded in 2005 by Simon Curran and Lucien Law, has been acquired by the Melbourne-headquartered Bastion Collective (Law departed from the business in 2017).
The Companies Office shows that Bastion has taken a controlling 80 per cent stake in the business, leaving 20 per cent with existing shareholders.
Speaking to the Herald, Curran would not disclose the final sale figure, which will be paid off over several years.
The name of the company will become Bastion Shine as the business transitions into the new ownership structure.
Curran commissioned KPMG and MinterEllisonRuddWatts to pursue potential buyers for the business off the back of the first lockdown 18 months ago.
"The brief we set ourselves and KPMG was probably one of those briefs that we would be frustrated with if we got ourselves," says Curran.
"What we wanted were skillsets that we didn't have and we wanted access to markets that we're not in, but we wanted to do all that while retaining control of how we run our business."
Curran says that he and the rest of the executive team looked into a range of options that would enable the company to grow locally and abroad.
"We looked at acquiring businesses, we looked into merging and also considered bringing in an investor," he says.
After early discussions with Shine, Bastion's founding brothers chief executive Jack Watts and chair Ferguson Watts put in an offer and a request for an exclusive period of due diligence.
Bastion currently employs around 300 staff globally, across offices in Melbourne, Sydney, Auckland, Los Angeles, Newport Beach and New York, and counts Microsoft, Google, KFC and AIA among its clients.
Jack Watts told the Herald that the agency intends to extend its footprint across the globe.
"In every market we operate in, we look for a partner who thinks wide across the breadth of communications disciplines, and believes that the future of agencies is independence at scale," he said.
"In the team at Shine, not only did we find this, but we also found a shared set of values and principles that I have rarely experienced. For more than a decade we have both built similar businesses on either side of the Tasman and to unite now is beyond exciting for our business, our people and our clients. It felt right from the first meeting"
Shine has no shortage of hefty clients in this market either, counting Air New Zealand, Spark and Genesis as major names on the ledger.
The acquisition of Shine is the latest in a number of examples of Kiwi firms being snapped up by international companies. While the deal isn't as big as the sale of the Weta Digital tech division or that of Vend, it does show that the international market is keeping a close eye on what New Zealanders are doing.
Curran says he adopted a transparent approach to the acquisition from early in the process.
"We told all our staff we were thinking about it and then we told each of the chief executives that we work with," says Curran.
"Each of those CEOs wrote a letter of endorsement for us that went into the process of looking for a partner.
"Air New Zealand chief executive Greg Foran, Spark chief executive Jolie Hodson and Genesis chief customer officer Tracey Hickman were all part of the due diligence process."
Acquisition deals of independent creative agencies are relatively rare in the local market. The highest-profile deals to have been made in recent years was the sale of Barnes, Catmur & Friends to the Dentsu Group in 2016 and the earlier acquisition of Assignment Group by holding company STW (and later swallowed up by WPP).
The full amount of these deals have never been disclosed, but an industry source familiar with mergers and acquisitions estimates that Barnes Catmur sold for under $10 million while Assignment went for around $20million. Based on the size of the business, its client list and current low-interest market conditions, the source suggested that Shine could be sold for more than Assignment if targets are met in the coming years.
As an indication of how these things usually go, neither Barnes, Catmur & Friends nor the Assignment Group names exist any longer – and the founders initially associated with those companies have since moved on.
Barnes Catmur has morphed into the creative arm sitting with the Dentsu Group, while Assignment was merged with Y&R to create the mouthful known as VMLY&R within the WPP advertising group.
Asked whether he was looking to make a similar exit from the agency in the coming years, Curran responded emphatically that this was not his plan.
"We are locked in," he said, stressing out that the local team would still retain 20 per cent of the business.
"No one's going anywhere. I remain the chief executive. Andy [McLeish] remains the head of strategy and Richard [Maddocks] will still be our head of creative. So there will be no change to any of the roles."
Curran explained that it was important for the team at Shine that any deal didn't affect the way they ran their business.
"This is not about an Australian business buying a New Zealand business and all of a sudden running it like an offshoot," says Curran.
"One of most important requests by our senior clients to Bastion was: 'Tell me nothing is going to change day to day.' And the reassurance we've been able to provide is that our clients will have all the things we are today and more."
McLeish added that an important feature differentiating this deal from those that came earlier is that Shine will become the biggest single agency within the new company, rather than a smaller firm swallowed up by a giant.
"I think we're about double the size of the next biggest agency in the group," says McLeish of Shine, which currently employs around 58 staff to service its New Zealand-based clients.
"It's not like we're a small fry being swallowed up by a really big guy."
McLeish and Curran see an opportunity to take Shine into the international markets where Bastion already operates.
The success of New Zealand independent agency Special Group in both Australia and the US has shown that there's an appetite for Kiwi thinking beyond these borders, and Bastion's contacts abroad could provide a good stepping stone for the team behind Shine to grow internationally.
"It's a big old map," says Curran, when asked about Shine's international ambitions.
"It's about finding the right sources of well-paced growth that don't stretch us past what we do but do fuel our ambition to do more."
The question now is which markets will next get a taste of the Kiwi thinking behind the newly minted Bastion Shine.
It says it's collateral damage in the city's war on Airbnb and will try again elsewhere.