INTERNATIONAL NEWS: Incepta ponies up dollars 17m to get Red after layoffs at its Citigate division

LONDON: Marketing services group Incepta has bought consumer specialist The Red Consultancy for an initial pounds 12 million (dollars 17 million).

LONDON: Marketing services group Incepta has bought consumer specialist The Red Consultancy for an initial pounds 12 million (dollars 17 million).

LONDON: Marketing services group Incepta has bought consumer specialist The Red Consultancy for an initial pounds 12 million (dollars 17 million).

The acquisition follows last week's news that US Incepta agency Citigate Cunningham has laid off 40 of its 210 employees and shut its Chicago office (PRWeek, February 19, 2001).

Red will retain its name and, unlike other PR brands within Incepta, become part of the firm's marketing services division, rather than fall under the Citigate brand.

Incepta joint-founder Lesley Brend denied that the agency had any immediate plans for opening further offices or making additional acquisitions.

However, Incepta CEO David Wright said, 'Red will play a major part in our plans to build our PR brands across Europe.'

Incepta acquired Red for an initial consideration of pounds 12 million, comprising cash and stock. Final consideration, dependent on the future financial performance of Red, could reach as much as pounds 25 million (dollars 36 million) after three years.

'Joining Incepta is a giant leg-up for us,' Brend said. 'It takes us overnight to a position that would've taken us ten years to achieve by ourselves.'

As a result of the deal, Brend will become chairman and David Fuller will become managing director. Also, board directors Andrew Baiden and Mike Morgan have been named deputy managing directors.

In the year ending June 30, 2000, Red earned pounds 4.9 million (dollars 7 million) in total income.





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