MSQ Partners is to buy Be Heard Partnership and its three agencies – MMT Digital, Freemavens and Agenda21 – in a deal worth about £6.2m.
The remaining Be Heard agency, The Corner, is to be sold back to its management team. The Corner was acquired by Be Heard in 2017 for £12m.
MSQ's acquisition, which is subject to shareholder approval, will create a business with 765 staff in the UK, Asia and the US. It will be led by chief executive Peter Reid. MSQ said there would be no redundancies as a result of the change of ownership.
MSQ is backed by private-equity company LDC, which has supported the deal. The purchase aims to "accelerate MSQ’s growth by building scale and increasing its technical capabilities, particularly in digital tech and data analytics".
As part of the deal, digital media shop Agenda21 will be merged with Walk-In Media, the agency launched by Simon Davis last year, to strengthen the latter’s digital capabilities.
Tech and digital transformation shop MMT and data analytics and insight agency Freemavens will continue to operate as separate brands. MSQ said that MMT’s revenues have grown from £5m in 2016 to £15m in 2019 and Freemavens’ from about £1.9m to £4.3m in the same period.
Ben Rudman, chief operating officer at Be Heard and co-founder of MMT, will join MSQ’s board as an executive director alongside Kate Howe, who recently joined MSQ from Dentsu Aegis Network UK. MSQ’s board is led by non-executive chairman Charles Courtier.
Be Heard has 240 staff based in London and Uppingham who will transfer over to MSQ. Its key clients include GlaxoSmithKline, Unilever and Vodafone.
MSQ has 525 staff and six agency brands: Holmes & Marchant (branding and design), Smarts (PR and content), Stack (customer acquisition and engagement), Stein IAS (business-to-business marketing), The Gate (creative and media) and Twentysix (digital).
Peter Scott, a founder of WCRS, launched Be Heard in 2015 and spent tens of millions of pounds on a string of acquisitions, including Agenda21 for an initial consideration of £3.3m plus earn-out, MMT for £5.1m and Kameleon for £4.1m.
However, the group struggled, reporting a pre-tax loss of £10.3m in 2018 and £7.9m in 2019, before warning in April that the coronavirus downturn was having a "profound impact" on the business.