Cello Group has moved to strengthen its struggling Leith London agency with the acquisition of Farm Communications.
The deal, made for an undisclosed sum, will see a full merger of the the two agencies. Farm's £17 million in UK billings will compensate for Leith's loss of Carling, its biggest client, earlier this year.
Farm's and Leith's client lists will be combined under one agency roof.
These include smile.co.uk, Smart, COI, Paramount and Merlin Entertainments.
The new agency will be headed by a merged management team formed from the two agencies. Farm's Rob Smith and Leith's Jeremy Pyne will be the managing partners, reporting to John Rowley, the chairman.
The creative department will be overseen by Farm's former creative heads Gary Robinson and Owen Lee, and Leith's top creative team John Messum and Simon Beer.
It is unclear at present what the new agency will be called.
Smith said: "Becoming part of a bigger group gives you gravitas. Clients have concerns when you don't have scale and you get overlooked. This gives us the opportunity to make it to the next notch.
"Plus, the whole style of the group, with its partnership structure, means a good fit with our culture - we're joining a peer group who have bought into this concept rather than sold out."
The merged agency will sit inside Cello's brand consulting division.
This also includes The Value Engineers and TMI.
Mark Scott, the Cello Group chief executive, added: "The combination of Farm and Leith London will give us critical mass in the London market. The focus will be a strong core of planning from which clients can be better advised on how best to support and build their brands."
As part of the reorganisation process, Monkey - the media agency that is part-owned by Farm - has become independent.
Farm recently joined the COI roster. It secured the Enjoy England account after a final shoot-out against Delaney Lund Knox Warren & Partners and St Luke's in a pitch that was concluded earlier this month.