Under the terms of the acquisition, Razorfish will issue up to 656,000
of its common stock and give $750,000 in cash to Fuel and Tonga’s sole
shareholder in exchange for the entire equity interest in Fuel and
Razorfish closed Friday at $36.25, up 5.65 percent.
A further contingent payment in shares or cash will be made in 2000
upon the combined revenue of Fuel and Tonga for 1999, provided that the
consideration for the acquisition will not exceed $38 million. The
acquisition will be accounted for under the purchase method of
is expected to be non-dilutive on a cash basis for 1999 and 2000, the
Jeff Dachis, president and CEO of Razorfish, said the acquisition allows
Razorfish to “enhance its already considerable ability to provide a
end-to-end solution for user experiences across networks, platforms and
“Fuel brings a critical depth and experience in broadcast design,
graphics, live action production and interactive television, which will
Razorfish access the merging world of digital networks and traditional
television, and gain an unmatched competitive advantage,” said Dachis.
Fuel has worked for such clients as ABC, CBS, NBC, Showtime, Discovery,
ESPN, The Disney Channel, E!Entertainment; film studios such as Columbia
Tristar and Disney; and advertising agencies such as TBWA Chiat /Day,
Erickson, Young and Rubicam, and DDB Needham. For the calendar year
December 31, the combined revenue of Fuel and Tonga was $5.3 million.
and Tonga currently have 24 employees.