January 06, 2006
Digitas to acquire Medical Broadcasting Company
Consumer interactive agency Digitas has entered an agreement to buy healthcare interactive agency Medical Broadcasting Company (MBC). Terms of the deal will include an initial payment of $30.4 million, composed of $22.4 million in cash and $8 million in Digitas stock to be made at closing, sometime during the first quarter of 2006, according to a jointly issued news release. MBC is expected to retain its brand identity and will continue to be led by cofounders David Kramer and Linda Holliday. Kramer and Holliday said in a joint statement: “We’ve enjoyed long-term relationships with a blue-chip roster of healthcare and pharmaceutical companies. Now, thanks to a doubling in consumers’ use of the Internet as a medical information source and its ranking only behind care providers as the most credible source, on-line marketing is ascending to become a new leading media channel for healthcare. Many of our clients are preparing to advance their businesses’ online strategy to address this and we see tremendous benefit in being affiliated with the robust digital marketing capabilities found in the Digitas family of agencies.” David Kenny, CEO of Digitas, said in a statement, “MBC’s wealth of industry expertise in both professional and patient communications is a complement to our strategy of targeting the healthcare and pharmaceuticals marketplace.” MBC expects to earn fee revenues of $23 million to $25 million for 2005 and has 140 employees at its office in Philadelphia. Its client roster includes Abbott Laboratories, Allergan, AstraZeneca, Bristol-Myers Squibb, Eli Lilly, GlaxoSmithKline, Johnson & Johnson, Merck, Novartis, Pfizer, Sanofi-Aventis, Schering-Plough and Wyeth, among others. Digitas said it expects to discuss further the acquisition following the transaction’s close.