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European communications consultancy Hanover Group has acquired the Middle Eastern assets of Bell Pottinger, the PR firm that fell apart after it was accused of stoking racial tensions in South Africa as part of its work for the Gupta family.

Financial terms of the deal, which represents another step towards the break-up of the collapsed firm, were not disclosed. 

Bell Pottinger’s Asian business recently said it would re-brand itself as Klareco while Heather Kerzner, the fiancée of James Henderson, Bell Pottinger’s former chief executive, has instructed the London law firm Grosvenor Law to explore ways of clawing back some of her investment in the company. 

In September, a majority of Bell Pottinger’s 250 staff were made redundant. Administrators from accountancy firm BDO have been working to salvage what they can from the company, once one of Britain’s best known public relations firms. 

Bell Pottinger Middle East was not implicated in the South African scandal that engulfed the firm and led to its downfall.

The Public Relations and Communications Association, the UK PR industry’s trade body, expelled Bell Pottinger for at least five years after it concluded that its campaign work on behalf of the Gupta family in South Africa — which was at the heart of a scandal engulfing President Jacob Zuma — was likely to inflame “racial discord”. Francis Ingham, the head of the PRCA, described the work as the “most blatant instance of unethical practice” he had ever seen.

“It’s been a tough ride but the hard work starts here,” said Archie Berens, managing director of BPME. “We’ve had huge support from our clients and now have a new home.” 

Jonty Summers, Hanover Middle East managing director, will become managing director of the combined business while Mr Berens will become chairman. Charles Lewington, Hanover’s chief executive, said BPME was a “terrific business” which “presents a strategic opportunity for Hanover”. 

Hanover advises clients in the financial services, healthcare, technology, media and telecoms sectors. The acquisition will add 14 consultants to Hanover’s team and take its 2018 fee income to more than £20m. 

“The Middle East team are a great fit [and] bringing Archie and the team on board creates scale and presence . . . for Hanover in both Dubai and Abu Dhabi,” said Joe Hine, a partner at SI Partners, which advised Hanover. He added that the sale “provides an excellent platform for growth for the combined business”. 

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