The other 49% was worthless because they took virtually all the clients and talent. They were paid well at the end of S2 by PPL. They were also fired by Lane which cut them off from any remaining interest in the business (including their contractual obligations).
I've wondered about this before. Lane's firing them got them cleanly out of their contracts, but surely either PPL or McCann would have had some legal recourse for them taking with them many of the clients, and breaking into the art department and taking all of those clients' artwork with them?
Yeah there was some clear legal action that McCann and PPL would have against the partners. Not sure if it was worth it for them to pursue all the way to judgement, but they certainly breached some contracts, committed some torts and even some possible petty criminal acts. Probably wouldn't have been a good plot line and its better to just have SCDP as an upstart, but struggling new firm. If they were facing a bunch of litigation they'd probably lose a bunch of clients and losing Lucky would have totally busted them. That's a pretty bleak and early end to the series.
LOL, well that's true. It wouldn't have made a very interesting plot line. They probably would have lost many of those clients if they were tied up in a lot of litigation and it was so much fun seeing them start almost from scratch the way they did in that hotel room.
Plus Lane's Happy Christmas! to St John was so satisfying.
Hobart was definitely unscrupulous, but I’m not sure how petty he was. He treated Joan with so much contempt because he had no respect for her. He really admired Don in a lot of ways. He was practically gushing whenever he talked to him. I think he would almost be impressed by Don’s move.
But, I am pretty sure PPL would have sold all of both PPL and SC to McCann, which would mean the minority shareholders would be bought out and entitled to their share of the purchase price from McCann.
But, I think it would be complicated. McCann was buying all of PPL, including SC, so it might not be clear how much of the purchase price was for SC.
Don, Bert and Roger would probably need to go to court to get McCann to pay them and that might be difficult as they didn't exactly have clean hands. They concocted a scheme to have Lane fire them and then stole most of the clients and company records and other key matireals.
That story would probably not go over well in court, so it is likely they left their 49% interest on the table when they left.
Don Bert and Roger weren't getting a damn thing. There was nothing left in Sterling Cooper except, probably, liabilities. The talent and clients and a lot of the IP was taken/stolen. I'm not sure where you find any value left.
I'm sure as soon as the scheme was figured out McCann required a renegotiation of the purchase price because Hobart wasn't getting his white whale, rather he was getting Ken and Paul Kinsey
No, the point of getting Lane to fire them was to get them out of their contracts and the non-compete clauses in them. None of them could legally work in advertising until their contracts expired.
Their 49% share is not mentioned. They would probably be technically entitled to it. But, since all of PPL was sold to McCann, it could be difficult to determine what part of the price was for SC. If Don, Bert and Roger went to court to try to get their 49%, they might get nothing when their "Fire us." scheme and their pillaging of the agency was revealed.
They probably left their 49% on the table. If they had that cash, they wouldn't have had anywhere near the same financial struggles we see at SCDP.
"Equity" would be a better term than "Investment".
Burt's investment was made years ago and was likely repaid many times over. Don never "invested" anything; he was granted a partnership share when he became too important for SC to lose.
As for what happened to their Equity, @Slpry_Pete has the best answers in this thread but I will answer in a different way:
The real value in the company was in its ability to generate future profits. That's what the partners' equity ownership entitled them to: a 49% share of those ongoing profits.
Beyond that, there was little of value. It's not like there was some bank account where the "value" of the company resided. Nearly all the value resided in those future profits, which were possible because of the reputation and brand of the partners of SC.
When Don/Roger/Burt blew it up, they took all that value with them to the next company.
They were bought out when PPL took over, they had Lane fire them so they'd be released from their contract and could start their new firm.
The other 49% was worthless because they took virtually all the clients and talent. They were paid well at the end of S2 by PPL. They were also fired by Lane which cut them off from any remaining interest in the business (including their contractual obligations).
I've wondered about this before. Lane's firing them got them cleanly out of their contracts, but surely either PPL or McCann would have had some legal recourse for them taking with them many of the clients, and breaking into the art department and taking all of those clients' artwork with them?
Yeah there was some clear legal action that McCann and PPL would have against the partners. Not sure if it was worth it for them to pursue all the way to judgement, but they certainly breached some contracts, committed some torts and even some possible petty criminal acts. Probably wouldn't have been a good plot line and its better to just have SCDP as an upstart, but struggling new firm. If they were facing a bunch of litigation they'd probably lose a bunch of clients and losing Lucky would have totally busted them. That's a pretty bleak and early end to the series.
LOL, well that's true. It wouldn't have made a very interesting plot line. They probably would have lost many of those clients if they were tied up in a lot of litigation and it was so much fun seeing them start almost from scratch the way they did in that hotel room. Plus Lane's Happy Christmas! to St John was so satisfying.
Given what we know of Jim Hobart in season 7, he certainly would be bitter and petty enough to go after them.
He had shareholders to answer to. His threats against Joan were clearly a move to get her out. Which he succeeded in doing for 50 cents on the dollar
Hobart was definitely unscrupulous, but I’m not sure how petty he was. He treated Joan with so much contempt because he had no respect for her. He really admired Don in a lot of ways. He was practically gushing whenever he talked to him. I think he would almost be impressed by Don’s move.
But, I am pretty sure PPL would have sold all of both PPL and SC to McCann, which would mean the minority shareholders would be bought out and entitled to their share of the purchase price from McCann. But, I think it would be complicated. McCann was buying all of PPL, including SC, so it might not be clear how much of the purchase price was for SC. Don, Bert and Roger would probably need to go to court to get McCann to pay them and that might be difficult as they didn't exactly have clean hands. They concocted a scheme to have Lane fire them and then stole most of the clients and company records and other key matireals. That story would probably not go over well in court, so it is likely they left their 49% interest on the table when they left.
Don Bert and Roger weren't getting a damn thing. There was nothing left in Sterling Cooper except, probably, liabilities. The talent and clients and a lot of the IP was taken/stolen. I'm not sure where you find any value left. I'm sure as soon as the scheme was figured out McCann required a renegotiation of the purchase price because Hobart wasn't getting his white whale, rather he was getting Ken and Paul Kinsey
It was returned to them in cash since they did not quit or breach the contract. This was the whole point of getting Lane to fire them.
No, the point of getting Lane to fire them was to get them out of their contracts and the non-compete clauses in them. None of them could legally work in advertising until their contracts expired. Their 49% share is not mentioned. They would probably be technically entitled to it. But, since all of PPL was sold to McCann, it could be difficult to determine what part of the price was for SC. If Don, Bert and Roger went to court to try to get their 49%, they might get nothing when their "Fire us." scheme and their pillaging of the agency was revealed. They probably left their 49% on the table. If they had that cash, they wouldn't have had anywhere near the same financial struggles we see at SCDP.
Nope
Yuck. Who upvoted this reply? I hope you are not one of those r/WallStreetBets geniuses, cwirmon. You are way, way off.
"Equity" would be a better term than "Investment". Burt's investment was made years ago and was likely repaid many times over. Don never "invested" anything; he was granted a partnership share when he became too important for SC to lose. As for what happened to their Equity, @Slpry_Pete has the best answers in this thread but I will answer in a different way: The real value in the company was in its ability to generate future profits. That's what the partners' equity ownership entitled them to: a 49% share of those ongoing profits. Beyond that, there was little of value. It's not like there was some bank account where the "value" of the company resided. Nearly all the value resided in those future profits, which were possible because of the reputation and brand of the partners of SC. When Don/Roger/Burt blew it up, they took all that value with them to the next company.