British-backed marketing services group Engine USA on Tuesday announced the acquisition of digital agency Deep Focus. Financial terms of the deal were not disclosed.
"Ambitious" is how Martin Puris, chief executive officer of Engine USA, describes his company's mission, which is "nothing short of creating a radically new, collaborative environment, free of ancient baggage and earn-out-based financial models."
Engine USA, part of the Engine Group, a London-based independent communications and marketing company, was established in New York this past February with Puris as CEO and John Bernbach as COO. NYC-based Deep Focus is Engine USA's first acquisition, and points the way for the agency going forward, according to Bernbach. "Digital must be the heart and head of Engine," said Bernbach. "Digital is more than technology; it's a metaphor for a new way of thinking."
Last week, Engine -- which reported $54 million in revenue for the first half of the year -- announced a $100 million investment in the business by an affiliate of global private investment firm H.I.G. Capital.
The investment is expected to help Engine expand across additional markets, including in the USA, China, Brazil and selected European markets.
Some industry insiders see the deal as a precursor to more investment in the U.S. market for Engine.
"Deep Focus provides a best-in-class digital offering that is critical to positioning Engine as a preeminent player," said Philip Palazzo Jr., founder and president of Palazzo, a financial advisory and acquisitions firm for the marketing communications industry. "Today's deal is the first of many transactions to come for Engine in the U.S. market."
Deep Focus CEO Ian Schafer founded the agency in 2002 following a stint as vice president of new media at Miramax/Dimension Films, then chaired by Harvey Weinstein.
Per the acquisition, Schafer will stay on as CEO of Deep Focus. "We're going to be building something amazing together, keeping digital at the head -- and heart -- of a marketing organization that was actually built in this decade to reach consumers in the way they are actually behaving," Schafer said in a Tuesday blog post.
"This isn't an exit, it's a grand-freaking-entrance, and we can't wait to show you what we've got up our sleeves," Schafer added.
Presently, Deep Focus clients include Microsoft, Nintendo, Diageo, AMC, Weight Watchers, Bulgari, The Museum of Modern Art, Samsung and ESPN, among others.
Recently, Deep Focus has been recognized for such campaigns as AMC's "Mad Men Yourself," and a brand integration of Microsoft's Bing into Zynga's popular gaming platform FarmVille.
The deal is just the latest example of a large foreign holding company acquiring an up-and-coming domestic agency. At the beginning of the year, for example, Dentsu Holdings USA, the U.S. division of one of Japan's largest agency holding companies, acquired Innovation Interactive LLC, the New York-based parent of interactive agencies specializing in search, social media and audience targeting, including: 360i, SearchIgnite and Netmining.