Bucking a recent lobbying industry trend away from corporate buyouts, the Federalist Group, a prominent all-Republican shop, announced Monday that the firm has been acquired by communications giant Ogilvy Public Relations Worldwide.
Both sides declined to discuss the deal’s financing, including the sum Ogilvy paid for the firm.
But with the purchase, Ogilvy — itself owned by British conglomerate WPP Group — is obtaining one of the city’s strongest lobbying practices. Last year, the Federalist Group commanded $12.1 million in fees, placing it 13th among lobbying firms for revenue.
Principals said the deal benefits both firms by bringing complementary practices together.
“We can now offer a richer and more robust response to client issues than either firm could offer alone,” said Robert Mathias, managing director of Ogilvy PR’s Washington office.
Drew Maloney, a partner at the Federalist Group, added, “The days of the quick fix and back room deals are done. Now, every issue is like a campaign issue — it requires grassroots, PR, as well as a tactical legislative approach. This gives us the opportunity to put that package together when we need to.”
The deal harkens back to the 1990s, when lobbyists with equity stakes in their firms eagerly embraced lucrative buyout offers from conglomerates. The fervor for mergers and acquisitions cooled, however, once lobbyists encountered the unattractive prospect of sacrificing old freedoms to distant corporate bosses.
Stewart Hall, the Federalist Group’s president, said the deal didn’t fit that mold.
“We didn’t approach this as, ‘We want to sell the firm and get a payday,’” he said. “It’s really been the opposite: How do we get in with a group of people and make it work? In the end, you bet on people. We like these people, and for now, they like us.”
Further, Mathias said his firm has no intention of micromanaging the Federalist Group. “The last thing we want to do is come in and screw up something that’s working,” he said.
The Federalist Group is the first all-Republican addition to WPP’s elite stable of lobbying firms, which includes Quinn Gillespie & Associates, Timmons and Co., Wexler & Walker Public Policy Associates and BKSH & Associates.
The firm, founded by Hall, a former legislative director to Sen. Richard Shelby (R-Ala.), has a blue-chip client roster that includes Visa, Ameriquest Mortgage, Mirant and Motorola.
Most recently, the firm helped gin up Congressional opposition in a successful campaign by Chevron to beat back a Chinese company’s competing bid for the oil company Unocal.
In part, the firm owes its client roster to the Republican bona fides of its principals. Maloney was legislative director to then-House Majority Whip Tom DeLay (R-Texas); partner Wayne Berman was a top Bush fundraiser who served as senior adviser to the president’s 2001 transition team; John Green directed the political action committee of Sen. Trent Lott (R-Miss.); and James Jay Baker was the top lobbyist at the National Rifle Association.
Officially, the firm will now be known as “the Federalist Group, an Oglivy PR Company.” By the end of the year, it plans to join Ogilvy at its new Washington address, 1111 19th St. NW.