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GM Owes Publicis Less Than First Feared

  • Adweek, Wednesday, July 22, 2009 12:16 AM

Publicis Groupe says it has substantially reduced its "maximum exposure" to client General Motor's bankruptcy procedure. The French holding company says it has been paid the bulk of its fee receivables.

In its Chapter 11 bankruptcy petition in June, GM said it owed $146 million to Publicis and its subsidiary Starcom MediaVest Group. But Publics said around the same time that it calculated its maximum exposure at $78 million. Now, after having received payments from "The New GM," Publicis says its maximum exposure is less than $13 million.

There is no word yet on how the shop's new exposure estimate will affect its credit rating. In the wake of GM's bankruptcy, Standard & Poor's placed Publicis' long-term corporate credit and senior unsecured debt ratings on CreditWatch, with negative implications. S&P said at the time it would likely adjust the Publicis ratings based on how the GM situation unfolded.

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