NEW YORK: Next Fifteen has acquired M Booth and Associates, as part of the holding company's longstanding strategy to grow its consumer PR capabilities in the US.
Next Fifteen has reported that it paid an initial price of $4 million for the acquisition. An additional $13.25 million will be paid over the next four years, if revenue and profit targets are met.
M Booth CEO Margaret Booth will report to Bay Area-based Next Fifteen CEO Tim Dyson. Dyson plans to ultimately create a new global consumer PR brand with M Booth and fellow Next Fifteen agency Lexis PR, which mostly operates in London. But both agencies will currently maintain their board of directors and separate profit-and-loss statements, he said.
“This is a long-term ambition – you're not going to see any drastic changes overnight,” he said, adding that the two firms have been in talks for nearly two years. During this time M Booth and Lexis have worked on several projects together, Dyson added.
Last year M Booth's revenues totaled nearly $11.4 million, which was flat compared with 2007. Prior to last year, the agency averaged about 15% to 20% revenue growth each year, Booth said. The agency's clients include Unilever, which also works with Lexis, and JC Penney.
Next Fifteen ended its fiscal year on July 31 and reported “very, very modest” revenue growth, Dyson said. The London-based holding company's current US presence includes tech firms Text 100, Bite Communications, and OutCast Communications.
Following the acquisition, Next Fifteen will implement a new leadership team, which Dyson will chair, that oversees the integrated M Booth and Lexis teams. Lexis CEO Margot Raggett, Booth, Brad Rodney, managing partner at M Booth, and Greg Broadbent, principal at Lexis, will serve on the team.
“We're going to operate as our own agency but in the coming months we're going to look for synergies,” Booth said. Among those, the two agencies will look into developing global templates for clients and sharing expertise like M Booth's experience in nutrition PR with Lexis' capabilities with the youth market, she noted.
“The purpose of the leadership team will be to map out this global proposition,” Dyson said. “The idea is to build a global business together. The only way we can practically do that is by having one team that works on that.”
Booth said she was drawn to making the deal – despite the struggling economy – because of the opportunity to build a global consumer brand with Lexis and to work in alignment with Next Fifteen's tech agencies in the US.
“[These agencies] will need some consumer and b-to-b help around the edges,” Booth noted. “And to be able to provide that kind of help when they need it was appealing.”
Updated August 4, 2009, 1:40 PM