ICM Executives to Buy Out Majority Owner Rizvi Traverse
Chairman Jeff Berg, president Chris Silbermann and others will transform ICM into an agent-owned partnership.
ICM chairman Jeff Berg, president Chris Silbermann and others have an agreement in place to buy out the agency's majority owner, Rizvi Traverse Management, and transform ICM into an agent-owned partnership, according to multiple sources with knowledge of the matter.
The new ownership structure is expected to be in place by Jan. 1. The agreement ends weeks of speculation over the future of the agency; Silbermann has long sought to transform ICM into a partnership but appeared to face resistance from Rizvi Traverse.
Birmingham, Mich.-based Rizvi Traverse, headed by financier Suhail Rizvi, purchased a controlling stake in ICM in November 2005 for $75 million.
As part of the new agreement, Rizvi would no longer be involved with the agency, though it is expected that his firm will retain a long-term economic interest in ICM. It is not known what it will cost to buy out Rizvi Traverse.
“The reason it took a while and was complicated is because it is a deal that everybody is happy with,” a source with knowledge of the situation said.
Inside sources said that Berg denies reports that he is dialing back his work with the agency and is instead pledging to commit himself to ensuring the success of the new partnership. It is not yet clear how the new partnership will be structured or which agents will have a stake in the Century City-based company.
Sources close to the situation pegged the move to buy out Rizvi Traverse as a necessary evolution for the 150-agent firm, which was founded in 1975. Silbermann and colleagues Bob Broder and Ted Chervin were said to be frustrated with Rizvi; sources have said that Rizvi hasn't nurtured ICM, instead focusing on cost savings. Rizvi Traverse declined to comment.
THR has obtained an internal ICM memo sent by Berg, Silbermann and Rizvi Traverse partner Ben Kohn on Friday afternoon that addresses the matter. The news comes hours before the agency's annual holiday party. The memo is printed below:
"We are writing to update you on some important developments at ICM. We are pleased to announce that the agency’s owners have agreed on principle terms to establish an agent-owned partnership for ICM. Our primary objective always has been to remain highly competitive as we turn to the next generation of leaders at our agency. We are confident this new partnership will position the agency, its clients and employees well for the future. This is a great agency with terrific clients and outstanding people. Our success this and every year is due to the dedication of our employees and the results we have consistently achieved for our clients. We understand that there may be questions regarding details of this announcement and will update you periodically as we continue to move forward in this process. In the meantime, thank you for all of your hard work in 2011. We look forward to seeing everyone tonight at the holiday party."