Hachette Parent Buys Leading French Interactive Agency
An initial cash payment of 50 million Euros ($68.2 million U.S.) will be made, followed by performance based earn-outs in 2011 and 2013 of up to a maximum 50 million more Euros.
The deal gives Lagardere--parent of Hachette USA--a team of nearly 300 digital media experts serving more than 200 clients, and proprietary technologies in Web behavioral analysis, advertising campaign payback analysis, and the management of sponsored link auctions.
Earlier this year, Hachette USA bought Jumpstart Automotive Media for up to $110 million, which turned the publisher of Car and Driver into an ad seller as well as an online ad network.
"Aside from the strategic and business case for this deal," said Didier Quillot, chairman of the Lagardere Active Management Board, "the key challenge in this acquisition is to exploit fully the cultural mix between traditional and digital media."
Founded in 2005, Nextedia offers search marketing, media planning and online space buying, performance marketing, emailing, affiliate, CRM, mobile marketing, interactive media management and online PR, Web site and advertising campaign design, and database marketing.
According to the deal announcement, Nextedia generated gross profit of 9.7 million Euros ($13.23 million) and EBIT of 1.7 million ($2.31 million) in 2006. The company had a positive net cash position at the end of 2006 and is set to double in size in 2007.
These services will now be made available to advertisers and will also help Lagardere's content producers to increase their Internet audience and build Web communities around core affinities.
"By joining the Lagardere Group, we are buying into a market vision that appeals to us," said Henri Le Menestrel, chairman of Nextedia. "We are also tapping into significant resources that will secure the long-term development of Nextedia."