Engine Group has bought the direct marketing agency Partners Andrews Aldridge and Fuel, its data arm, in a deal worth around £18 million.
Under the terms of the acquisition, the group has made an upfront payment of around £9 million in cash plus the equivalent value in Engine shares, in exchange for 100 per cent of PAA and Fuel Data Strategies.
There is no earn-out arrangement, but the founding partners, Steve Aldridge and Phil Andrews, are understood to be tied into the business for the next three years.
Engine has also agreed terms to acquire the minority interest in its existing direct marketing business, Personal, and plans to merge the two companies into a single 100 person-strong entity, which will trade under the Partners Andrews Aldridge brand.
Andrews and Aldridge will become the chief executive and chairman of the new PAA. Personal's managing partner, Chris Ward, and its planning partner Greig McCallum, will retain their current titles at the new agency.
Andrews, the former chief executive of Arc Group's direct marketing outfit, Tomahawk, and Aldridge, a former creative director at Wunderman Cato Johnson, founded Partners Andrews Aldridge in 1998 as a joint venture with Partners BDDH. Following the buyout of Partners BDDH by Havas in 2003, the pair gained full ownership, buying Havas' stake in 2004.
Since PAA was founded, it has enjoyed considerable success, securing Campaign's Direct Agency of the Year in 2002, as well as a number of awards, including several silvers at the Campaign Direct Awards.
Peter Scott, Engine's group chief executive, said: "The deal complements the existing Engine skillset and brings on board highly talented management teams who will work with us to build the business into a leader within the sector."
Aldridge added: "Engine is the spiritual home of Partners. Like us, they place creativity and ideas in any medium at the heart of everything they do. This deal creates a springboard for our culture and phil-osophy to grow and develop."