Johannesburg - Paper Moon Design, an advertising subsidiary of Billboard Holdings, the integrated communications group, had instigated a management buyout from the group, it said yesterday.
Tony Holmes, the managing director of Paper Moon, said negotiations for the buyout were in the final phase and should be finished by the end of the month, when it would move to its new offices.
Holmes said he, Ian Goddard, the deputy managing director, and Louis van Coppenhagen, another director, had initiated the move to enable them to steer the company on their own, without the oversight of a holding company.
Paper Moon, the below-the-line advertising graphic design company, was sold in 1998 to Convergent Network, whose media interests were in turn acquired by Billboard last year. Its clients are mainly corporates, including SamRand, African Star Airline and Smith Kline Beecham.
Holmes dispelled speculation that the company was going under. "(It) is on a sound financial footing, restructured and focused on our core business."
He was aware that Billboard was also restructuring to focus on its core businesses, but was not informed of its complete plan.
Billboard, which has not yet unveiled its restructuring strategy, aims to group its 26 various businesses into four divisions: advertising, marketing services, exhibitions and events.
The advertising division includes companies such as The Agency, public relations company Twin Cities and Adele Lucas.
The marketing division comprises Broad Marketing, TMS, Brand Metrics, Briteside Television and Digital Pictures.
Exhibitions includes Shell System and Z Displays, and Events includes Prime Events, Javelin and Harlequin.
Malcolm Perrie, the acting chief executive, said last month the group would ideally want a 25 percent spread among the four centralised structures and it aimed to cut down on duplicated costs.
Billboard`s share gained 1c to close at 8c on the JSE yesterday.