The advisory firm set up by Lord Peter Mandelson, one of the architects of New Labour in the UK, has sold a 20 per cent stake to a US business run by a former Barack Obama aide in a first step towards a possible full-blown merger.
The investment by the Messina Group, founded in 2013 by former Obama campaign manager Jim Messina, values Mandelson ’s firm Global Counsel at about £30mn, said people close to the transaction.
The deal is the latest example of advisory firms in the public relations, regulatory and financial communications sector forming broader partnerships to serve clients internationally. Global Counsel’s presence in London, Brussels, Singapore and Doha would widen the geographic reach of the US-centric Messina Group, its founders told the Financial Times in an interview.
The transaction highlights the windfalls on offer to former officials and ministers who successfully switch to advising private sector groups on interactions with governments. Both Mandelson’s and Messina’s firms have capitalised on growing demand from companies for political and regulatory advice against a backdrop of geopolitical upheaval.
“Political and policy disruption is now a feature of all corporate and investor decision-making,” said Global Counsel co-founder and chief executive Benjamin Wegg-Prosser. The deal would create a “clear” path for his firm to work more closely with Messina’s operation, added Wegg-Prosser, a former communications director to then-prime minister Tony Blair.
Between them, Wegg-Prosser and Mandelson own the majority of Global Counsel, valuing their combined stakes at more than £15mn.
Messina was known as “The Fixer” when he worked on Obama ’s 2008 presidential campaign and was instrumental in the use of data in his 2012 re-election.
He said he hoped to expand his firm’s relationship with Global Counsel in future, adding that partnering with Mandelson and Wegg-Prosser would help his business to cement a place “at the centre of the innovation economy and regulation” as part of his push to “grow or die”.
The Messina Group has advised companies such as Google, Uber and Airbnb, sometimes being paid in shares rather than cash. It also advises governments and prime ministers, including then-prime minister David Cameron on his party’s 2015 general election victory over Ed Miliband’s Labour party.
It was also consulted on Cameron’s failed “Remain” campaign in the Brexit referendum and by Theresa May ahead of the 2017 election in which she lost her parliamentary majority.
Mandelson developed “New Labour” along with Blair and Gordon Brown in the 1990s, a revamped centrist version of Britain’s biggest left-leaning party.
He was business secretary under both Blair and Brown and is set to become more influential if the Labour party regains power in an election due to be called this year.
He is politically close to Labour’s director of campaigns, Morgan McSweeney, an adviser to party leader Sir Keir Starmer.
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House of Lords rules do not require Mandelson to disclose the clients of his advisory firm, which have included BP and Glencore. The group’s work includes political due diligence reports for private equity investors before they commit to buying businesses in regulated sectors. Global Counsel also works for investors, advising Chicago private equity firm GTCR, which last year bought a majority stake in payments group Worldpay.
Mandelson’s political career has not been without controversy . He was twice forced to resign from ministerial positions during the New Labour government.
Last year the FT reporte d that an internal probe by JPMorgan had found extensive social contacts between Mandelson and Jeffrey Epstein, the disgraced financier, more than a decade ago.
Mandelson will move from his current role as chair to become president of Global Counsel, which employs about 120 people globally. He will be succeeded by vice-chair Archie Norman, chair of FTSE 100 retailer Marks and Spencer and a former Conservative party MP.
Messina and another former Obama staffer Tara Corrigan will join Global Counsel’s board.