So, there’s been a takeover bid? PRs on tackling both rumour and fact
Kraft Heinz’s takeover bid for Unilever is a recent reminder that PRs must always be prepared for unexpected news, whether rumour or fact. Comms pros from Lansons, MHP and Future PR, discuss the best steps to take when a takeover story breaks out.
Kraft Heinz’s £115bn bid for Unilever and the speculation surrounding it showed that, whether a takeover bid is likely to happen or not, it can have an impact on company reputation.
In the case of Unilever, its shares fell by nearly 8% once the news had broken. This is despite the fact that brand had ‘no appetite for any offer’, according to The Guardian.
The scenario highlights the need for scenario planning as well as understanding of the media landscape. Louise Ahuja Lansons’ director says that when it comes to a complex bid involving major players the communications consultants would’ve taken exhaustive planning procedures, but when the story plays out PRs also need to be alive to the personalities and politics involved.
“The story broke in some detail, so at the point the journalist calls to alert you there is a need to engage with them to ascertain what they know and if it is the correct facts then best to go on the front foot. This is when you need to plan in the moment, read the live situation and be willing to throw out the playbook to get the message across you want.”
So, what are the first steps to take if your client, or brand, is at the centre of such a story and how can you plan to come out on top?
Distinguish rumour from fact
Andrew Leach, managing director at MHP Financial PR, says there are clear steps to take if the break out story is a rumour, or factually accurate. “If a takeover rumour about a client emerges, and a journalist contacts us for comment, we would always just say: ‘We never comment on market rumours or speculation.”
He adds: “If it does prove to be just rumour, and we know for sure there is no basis in fact, it may then be appropriate to guide journalists off the record that there is nothing to it. Of course, this needs to be done carefully, because if the approach is hostile the client would not necessarily know about it.”
Once established as fact, Leach says all communications must be governed by the business framework The Takeover Code that sets strict rules about what and how anything can be communicated.
“If the news has leaked and share prices are moving then both parties should agree statements as soon as possible and let shareholders, via a stock market announcement, know as much as they can. It could be a short statement if the parties are just in talks, and more detailed on terms if they have progressed to that stage,” says Leach.
He adds: “If it is a hostile bid then a swift and factual response to the predator can put the target back on the front foot – Unilever came back quickly with a statement saying Kraft’s offer fundamentally undervalued its business and recommended shareholders take no action.
“Some elements of crisis communications might apply. This could include setting up a bid-focused and dedicated PR team to monitor coverage and help to develop defence messaging in daily briefings with the client and other senior advisers.”
PRs need to work as an extension of the client’s internal team
Highly confidential business decisions can be difficult to manage. Nina Sawetz, MD at Future PR, says this is why clients need to work with PRs as an extension of their internal team, rather than just as one of their services.
“Whilst you may not be able to know all the facts beforehand, it’s important the client trusts and respects you enough to be made aware of the significance and the likely impact of the issue, and it’s even more important that you are ready for the media onslaught.
“For PRs on the other side of fence – the ones working for the client being taken over – it’s even more important that your relationship with your client is so tight that they know they can phone, text or email them at any time, wherever you are, and that when they do, you’ll not only react quickly, on the spot, with the best advice, but will also be on the ball to flag any new issues or media reports to them.”
Sawetz’s three steps for takeover success:
1. If you’re in PR and talking about being ‘always on’, mean it. Always on doesn’t mean you sign off at 5pm on a Friday.Business issues happen any day, any time. If you’re not prepared to drop everything to help your client, you’re in the wrong industry.
2. Make sure your relationship with your client is water tight – there will be a time when they can’t tell you anything and there will be a time when they can tell you everything. You need to trust them to do this when it’s right, but also be ready to give them advice when they need it most. Trust is key in this industry.
3. Always have an updated crisis and issues manual on file. Your client may laugh it off as something that will never be needed, but on that one occasion when it is, they’ll be thanking you.
It should always be one of the first things to tick off with a new client.
