Japanese advertising company The Hakuhodo Group has acquired a 60% interest in Hong Kong based communications agency Grebstad Hicks Communications (GHC Asia).
The remaining 40% will be gradually sold to the Group over the next four years.
GHC Asia was founded in Hong Kong by Lynn Grebstad and Paul Hicks in 1997 with a focus on luxury lifestyle clients such as hotels, resorts, luxury brands, fine dining establishments and government tourist authorities in various countries. It has offices in Shanghai, Singapore, Beijing and Bangkok.
The capital participation in GHC Asia by The Hakuhodo Group is part of its endeavor to strengthen its business network in newly developing countries, particularly in Asia.
As a member of the Hakuhodo Group, the communications agency will help boost the Group’s service provision structure for clients targeting the rapidly growing wealthy segment in Asia.
Paul Hicks, founding partner at GHC Asia, says the reasons for selling a majority stake in GHC Asia to Hakuhodo was not because the agency was struggling financially.
“Business is going strong. We just think it’s a good time to consolidate our strengths and make sure the business will continue to be strong and secure in the future,” Hicks said.
“We are committed to the business and want to stay on for the next four years.”
He adds that GHC Asia will continue to be managed separately from the Group by him and Grebstad. However, there will be a Hakuhodo board that the founders have to report to every quarter. While there are no lay-offs, no additional staff members will be hired.
One advantage of the deal for GHC Asia is that it will help the communications agency tap into the Japanese market, especially the local tourism industry.
“We feel that there is quite a lot of interest from Japanese clients but it is very difficult to break into that market without a Japanese partner,” Hicks said.
In the future, Hicks says the agency may look into potentially expanding its network by starting more ventures or through new acquisitions in Asia, such as expanding into mainland China, Indonesia, Malaysia and Korea.