As the crisis rocking the business deal between Prima Garnet and its foreign affiliate, Ogilvy Africa, deepens over the operation of Scanad Nigeria, a new agency under Ogilvy's network, the management of Airtel Nigeria, one of the organisation's juiciest accounts, has terminated the contract with the agency.
THISDAY checks revealed that Airtel called it quits with Prima Garnet at the weekend as a result of the celebrated dispute between the company and its partners, which a source said was already affecting the operational plans of the GSM firm.
Prima Garnet Ogilvy won the Airtel advertising account following the transition of the telecommunication company from Zain to Airtel Group.
A competent source, who confided in THISDAY at the weekend, said Airtel had already commenced moves to replace the embattled Prima Garnet as arrangements are being put in place to call for new pitches from other agencies.
According to the source, "Prima Garnet has just been dropped as a creative agency to avoid dragging the 'brand Airtel' in the mud but I don't have the details. But if you will be fair in your judgment, you will agree with me that the last two years have been very smooth and successful for the brand compared to what obtained before then, it will, therefore, be a tragedy if we allow the politics and acrimony in the advertising industry to tarnish the good image we have sustained. I think the best is for us to avoid it.
"The management of Airtel felt it could no longer bear the effect of the dispute between Prima Garnet and its erstwhile affiliate. Obviously, the ongoing legal battle and the attendant negative publicity, which the crisis has generated, have compelled the management of Airtel to look elsewhere for its image laundering," the source explained.
Industry analysts had expressed shock that Prima Garnet Communications, one of Nigeria's leading advertising holding companies, would take its long standing affiliate network partner, Ogilvy Africa, to court especially with Lolu Akinwunmi, Group MD/CEO Prima Garnet, sitting on the board of Ogilvy Africa.
The analysts had warned that should the fight get worse, a good number of agencies under the Ogilvy network would be affected by the outcome of the court case.
According to THISDAY source, the management of Airtel decided to search for new communication handlers so as to avoid being drawn into the controversy that is currently brewing between the agency and Scanad, a subsidiary of one of the African leading marketing services group, Scangroup, which made inroads into the Nigeria market last year.
In June 2010, after concluding a $10.7 billion transaction, which gave Indian Bharti Airtel the Zain Group's Celtel Africa Unit, the company formally changed its brand identity to Airtel.
With the new status, Prima Garnet had an advantage to add the account of the telecoms brand to its array of clients because of the relationship between its Ogilvy network and Airtel Group.
Trouble however started last year when the Scan group indicated its interest in opening a shop in Nigeria and subsequently appointed a former President of the Association of Advertising Agencies of Nigeria (AAAN), Mr. Rufai Ladipo, as Chief Executive Officer.
Meanwhile, before then, the Scanad Group had become the sole owner of 51 percent of Ogilvy affiliations in Africa among many strategic affiliations with other global agencies.
The news of Scanad interest in the Nigeria quickly unsettled the market, especially Mr. Lolu Akinwumi, who saw the new development as a threat to his business.
There was also the belief in some quarters that the process of entrance of the new comer was illogical, which made it insulting to local practitioners.
It got to a climax when the issue was dragged to court, when it appeared dialogue would not settle the crisis. Before the January sitting on the case, Akinwumi had in December secured a court injunction restraining Scanad from operating in Nigeria until the substantive suit, which was whether Ogilvy had any right to operate in Nigeria in affiliation with another agency while its affiliation with Prima Garnet was still subsisting.
If there is anything the crisis has caused, it is the division in the industry.