The volume of public relations mergers and acquisitions has not been slowed by the recession, based on numbers for the first half of 2001, but less revenue is changing hands as agencies apparently focus on smaller deals that meet specific strategic needs.

Three other interesting trends emerged in the second quarter, according to an analysis of M&A activity in the public relations industry conducted by The Holmes Report. The first was the acquisition by PR firms of non-traditional firms, including corporate branding and management consulting specialists; the second was the emergence of smaller firms as potential buyers; and the third was the increasing number of overseas deals.

There were four important “non-traditional” acquisitions in the second quarter. First, Omnicom’s Ketchum acquired Stromberg Consulting, a New York management consulting firm specializing in change management issues; then Interpublic’s Golin/Harris International acquired London-based corporate branding consultancy Springpoint; then the Magnet Communications unit of Havas bought Christopher Johnson Associates, a corporate identity boutique; and finally Edelman Public Relations Worldwide added management consultancy First&42nd at the same time it appointed its founder, Alison Canning, to head its international operations.

While the acquisition charts continue to be dominated by the giant holding companies—Omnicom agencies made five of the 21 deals in the second quarter, WPP and its agencies made six—smaller firms appear to be taking advantage of the downturn in the market to make strategic acquisitions. New York’s G.S. Schwartz & Company and Knoxville’s Ackermann Public Relations both made their first acquisitions in the second quarter, after Boston’s Clarke & Company hit the acquisition trail for the first time in March.

As for the overseas activity, it included several of the deals listed above as well as acquisitions in Korea by Brodeur Worldwide and Fleishman-Hillard; a trio of purchases in Australia by Ogilvy Public Relations Worldwide; an additional Australian acquisition by Fleishman-Hillard; and Edelman’s purchase of an agency in Brazil.

But the majority of the deals were for agencies with less than $2 million in fees. The biggest acquisitions included WPP Group’s purchase of U.K. investor relations and mergers and acquisitions specialist Finsbury, with revenues of about $13 million; Cohn & Wolfe’s acquisition of Texas technology specilist Springbok, with fees of around $10 million, and Ketchum’s addition of Corporate Technology Communications of Chicago, with fees of around $9 million.

The analysis does not include Interpublic’s acquisition of True North and its public relations subsidiary BSMG Worldwide, since it focuses on deals made primarily for public relations targets. Nor does it include deals that do not involve U.S.-based agencies, such as the acquisitions made by Lord Chadlington’s Huntsworth Group in the U.K.