Continuing the trend of consolidation among politically connected lobbying and public relations firms, Burson-Marsteller, a New York company, is negotiating to acquire Black, Manafort, Stone and Kelly (BMS&K), which had strong ties to the Reagan administration.
"We have been talking to them for some time. We are still talking," Gary Auxler, senior vice president of Burson-Marsteller said, adding that "no agreement has been reached." Charles Black of BMS&K said a decision is likely in a couple of weeks. "It looks good, but we are not there yet," he said.
In the early 1980s, BMS&K was Black, Manafort and Stone -- named for Black, Paul Manafort and Roger Stone -- and was one of the most controversial new firms in Washington.
It aggressively combined lobbying with campaign consulting so that it was often in the position of seeking votes from members of Congress whose campaigns had been designed in part by partners in the lobbying company.
Sources close to the negotiations said partners at BMS&K would give up paid political work in order to avoid such controversy in the future, if the deal is consummated. However, sources said the partners could perform individual volunteer work for campaigns.
All the BMS&K partners initially were Republicans, but in the mid-1980s the firm added Peter Kelly, a major Democratic fund-raiser, and James H. Healy, a former aide to House Ways and Means Committee Chairman Dan Rostenkowski (D-Ill.).
Black, a founding partner, is now acting as a volunteer spokesman for the Republican National Committee, filling in for RNC Chairman Lee Atwater, who is being treated for a brain tumor.
The company received extensive adverse publicity during the congressional probe of political influence over grants from the Department of Housing and Urban Development during the Reagan administration.
Manafort acknowledged during the hearings that the work he performed in return for consulting fees on HUD projects amounted to "influence peddling."
"The technical term for what we do -- and law firms, associations and professional groups do -- is lobby," Manafort testified. "For the purposes of today, I will stipulate that, in a narrow sense, some people may term it influence peddling."
Under the proposed deal, BMS&K would become a division of Burson-Martseller, creating a firm with combined annual revenue of about $25 million.
The attempted BMS&K acquisition is, according to some sources, an effort to stay competitive with a lobbying-public relations conglomerate growing under the corporate umbrella of an English company, the WPP Group.
WPP Group owns or partly owns Hill & Knowlton Inc., Ogilvy & Mather, Timmons & Co. and Reece Communications. These companies have hired a host of former political, congressional and White House aides as part of a drive to build influence in Washington.
Burson-Marsteller, a subsidiary of Young and Rubicam, already has acquired the firm of Gold and Liebengood. Its partners are Martin B. Gold, who served as counsel to former Senate majority leader Howard H. Baker Jr. (R-Tenn.) and Howard S. Liebengood, former Senate sergeant-at-arms.
Black, Manafort and Stone were part of a generation of political consultants who gained influence with the election of Ronald Reagan in 1980. Black and Stone were also active in the failed presidential bid of former representative Jack Kemp (R-N.Y.).