CCG Buys Interactive Agency
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London-based ad company Cordiant Communications Group aims to beef up its U.S. interactive capabilities with the $47.4 million all-stock purchase of MicroArts, a Portsmouth, New Hampshire-based I-shop.
According to the companies, the agency will be folded into CCG's existing interactive agency, CCG.XM. An additional $40.7 million in stock could be added to the purchase price, depending on MicroArts' performance during the next three years, CCG said.
"It's a great fit for us," said CCG.XM chief executive officer Ian Smith. "MicroArts is a recognized leader in defining and developing technology brands for the online space. We value the firm's knowledge of software and networking companies, which, in this era, is a ticket to enduring relevance. The acquisition brings an enrichment to our intellectual capital and depth to our client services."
Spokespeople for the companies said New York-based CCG.XM and MicroArts possess complementary skills. According to the firms, CCG.XM's core competencies lie in digital applications development, while MicroArts focuses on market strategies and user interface design.
"We are passionately committed to developing, cultivating, and growing client businesses in a networked environment," said MicroArts founder and CEO Michael DesRochers. "This will be a great partnership for us. CCG.XM's overseas offices and multinational clients give us the opportunity to operate on a global scale."
CCG's client relationships (CCG.XM clients include Unilever and Compaq Asia) also suggest another way that MicroArts will benefit: from traditional advertisers. That's important since most interactive agencies' revenues have flagged during the past two quarters as a result of the dot-com pure-play market shakeout.
And company execs added that the combined unit will be poised to take advantage of traditional advertisers as they move online in growing numbers.
"Developing new and existing brands on-line will be an essential part of every company's future strategy," said CCG CEO Michael Bungey. "With MicroArts and CCG.XM, we are ideally placed to service online brands and exploit the growth potential of this market."
The acquisition comes as one of the first outside purchases by CCG.XM, which was essentially cobbled together from old CCG and Bates interactive shops around the world. In March 2000, CCG restructured its wholly owned agencies in the U.S., Europe, the Middle East, Asia and Australia together under the CCG.XM moniker; most notable of those was 141 Interactive, out of New York City.