PR giant, oil industry group split

Edelman losing top client because of subsidiary spinoff

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Breakups are hard — especially when they mean losing contracts worth tens of millions of dollars a year.

Just ask Edelman.

Despite its status as the world’s largest public relations firm, Edelman and the American Petroleum Institute — the nation’s biggest oil and gas trade association — are about to end their decade-long relationship, according to the Holmes Report.

In January, the Center for Public Integrity reported that the PR giant earned a whopping $327.4 million from 2008-2012 in advertising and public relations contracts with the American Petroleum Institute. Details of the split aren’t yet clear.

But the Holmes Report, a trade journal, reported Thursday that Edelman’s advertising subsidiary — Blue Advertising — will be spinning off as an independent firm and taking along its advertising work for API.

In other words, Edelman is losing API mainly because the firm is losing part of itself.

Neither firm has issued a press release about the changes. Edelman declined to comment, and calls to API and Blue Advertising seeking comment were not immediately returned.

Edelman has not been one of API’s top five contractors for more than a year, according to tax filings. The trade group’s top contracts in 2013 included a $32.8 million advertising deal with Blue Advertising but no contracts with Edelman for public relations.

But API has not necessarily cut back on influencing the public. The oil lobby’s contracts with PR firm Fleishman Hillard grew from $4.8 million in 2011 to $23.9 million in 2013, according to annual tax filings.

This work has included print, TV, radio and digital media aimed at helping the petroleum group to “rebalance the conversation about the technique of hydraulic fracturing,” according to Fleishman Hillard’s website.

It’s unclear yet whether Fleishman Hillard will stand to gain more work with API n this shift.

The firm is certainly no stranger to the energy industry. It has also been hired to promote corporation ConocoPhillips, the Rockies Express Pipeline — a 1,700-mile natural gas pipeline, and the Canadian government development of its oil sands.

Edelman, on the other hand, formally declared it would not accept clients that deny climate change following a botched response to a survey and investigation by Climate Investigations Center and the Guardian about campaigns related to climate change.

The contracts between Edelman and API were by far the most lucrative deals inked between PR firms and trade associations from 2008 through 2012, according to the Center for Public Integrity’s recent investigation.

But Edelman wasn’t the only public relations firm that earned big contracts with politically active business groups seeking to shape policy by influencing the public.

Goddard Gunster, for example, earned millions from the American Beverage Association in campaigns opposing sugary beverage taxes.

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