Red Flag Consulting, a Dublin-headquartered strategic communications group led by Karl Brophy and chaired by Gavin O’Reilly, has been acquired by New York-based Ankura Consulting Group, a global management consulting firm.
While the sum paid for the Irish business has not been disclosed, industry sources put the value of the deal at about €45 million, which would equate to about 10 times its earnings before interest and tax last year. This sum is subject to a four-year earn out period.
Mr Brophy owns 75 per cent of the firm, indicating a payout for him of just more than €33 million. His wife, Deirdre Grant, is managing director of its Irish operation. Both of them, along with other executives at the firm, will remain with the business.
Filings at the companies office indicate that Mr O’Reilly, a son of the late businessman Tony O’Reilly and a former chief executive of Independent News & Media (INM), and his wife Christina own 8.8 per cent of the business between them. This would put them in line for a payout of just under €4 million.
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With the Ankura takeover, Mr O’Reilly and non-executive board members will cut their links with the company.
Séamus Conboy, who is head of Europe at Red Flag, owns 5.8 per cent of the company and stands to earn about €2.6 million from the sale. It is understood that a seven-figure sum will be paid to employees who don’t hold shares in the company, by way of a completion bonus. Staff were informed of the deal on Thursday.
A former journalist, Mr Brophy was the communications chief with INM (now Mediahuis Ireland) when it was a listed company and led by Mr O’Reilly. In 2023, Mr Brophy and Mr O’Reilly settled a claim for damages against INM and its former chairman, Leslie Buckley, over an unlawful breach of their data when Denis O’Brien was the main shareholder in the media business.
Founded in 2013, Red Flag has 65 staff and offices in Dublin, Brussels, Cape Town, London, and Washington, DC. Its clients include Diageo, Google, Coca-Cola and leading players in the meat, healthcare and food sectors.
[ Red Flag books €3m profit and prepares to pay large dividend to shareholdersOpens in new window ]
Mr Brophy said he was “hugely excited” to join Ankura to “leverage” their mutual strengths to support clients. “Since day one of Red Flag we’ve been massively ambitious on a global scale. In Ankura we’ve found a hugely impressive firm that already has global reach and scale with more than 3,000 clients,” he said.
“It’s been very clear in every conversation we’ve had with them that they more than match our ambition and they trust us to help them build the most expert and highest performing team of consultants in the world. We are very excited.”
It is understood that Ankura was one of a number of potential suitors considered by Red Flag following a strategic review of its future options.
Commenting on the deal, Ankura chief executive Kevin Lavin said Red Flag’s “unparalleled expertise” in strategic communications, public affairs and campaign management complements Ankura’s advisory services.
“Their team of experts – drawn from the worlds of business, politics, diplomacy, media and digital communications – is renowned for executing creative strategies that drive measurable results and significant value for clients,” he said.
Red Flag will join Ankura’s global strategic advisory business, which includes McLarty Associates, a leading global commercial diplomacy and geopolitical advisory firm, and GreenPoint, a US–China strategic advisory firm.
According to its website, Ankura has more than 2,000 employees serving more than 3,000 clients, with projects in 115 countries. It is understood that Ankura plans to establish its own operation in Ireland. US private-equity giant Madison Dearborn is a major investor in Ankura.
Ankura units are listed online as having worked for Coca-Cola, Disney, Microsoft, Mastercard, real-estate firm Jones Lang LaSalle and the Premier League in England.
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