Madison Avenue Turns Acquisitive, Holding Cos. Kick Off Buying Spree

The agency holding companies have kicked off the New Year with an aggressive buying spree, acquiring a diverse group of companies, including digital and media agencies, research firms and PR shops.

This week alone, WPP confirmed three acquisitions, while Publicis and the Interpublic Group also confirmed buying agencies. MDC Partners kicked off the acquisition surge two weeks ago with its purchase of independent media shop RJ Palmer. 

WPP, through different subsidiaries, bought stakes in an Australian digital shop and a Scandinavian PR agency and purchased a Chinese research firm.

WPP’s Burson-Marsteller bought a majority stake in Helsinki, Finland-based Viestintätoimisto Pohjoisranta Oy, which it described as one of the country’s largest communications firms. Clients include HP and SAP. The holding company cited Scandinavia as a region where it continues to strategically invest in properties. It now generates about $500 million in annual revenues from its Scandinavian operations.

WPP’s global ad agency Ogilvy acquired a one-third stake in Melbourne, Australia-based digital shop DTDigital. The company said the purchase is part of its effort to grow its digital assets -- to the point where they account for up to 40% of the company’s revenue by 2017. Currently, digital revenues total over $4.5 billion or nearly 30% of total revenue. 

Also, research subsidiary Kantar agreed to buy Chinese social media research and consulting agency CIC, which has offices in Shanghai and Beijing. CIC’s clients include L'Oreal, Pepsi, Dell, Nike and Burberry. Kantar said the operation would complement its existing operations in the country, which cover the retail, health, shopper, brand, innovation and custom research sectors. 

Publicis Groupe gobbled up one of the bigger independent French digital agencies, Mediagong. The shop will be aligned with Leo Burnett France and counts Danone, the global yogurt marketer, confectioner Lindt and Accor Hotels as clients. Despite the rocky European economy, the digital shop posted revenue growth in excess of 25% last year, according to the holding company. The firm is forecasting 20% growth in French Internet spending in 2012.

“Digital has become key to our clients, and the French market has the potential for strong growth,” stated Jean-Paul Brunier, president of Leo Burnett France. “This strategic acquisition means Leo Burnett will be among the very few full-service agencies with such a strong grounding in digital expertise." 

In addition, IPG confirmed the purchase this week of Nicole Weber Communications, a German consumer lifestyle marketing and PR agency with offices in Hamburg and Munich. NWC will become part of IPG’s GolinHarris network. Founder Nicole Weber will continue to lead the NWC team as managing director. The firm has created consumer campaigns for major brands, such as Henkel Cosmetics, Renault and Campari.

The spree kicked off two weeks ago with MDC’s purchase of New York media shop RJ Palmer, as part of its strategy to bulk up on the media planning and buying side of the advertising industry. That was followed by the Jan. 10 acquisition by Kantar of a majority stake in Pakistani market research firm Oasis Insights. Kantar cited Pakistan as one of the faster-growing emerging markets.

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