It will become the mobile marketing arm of Publicis Groupe Media, comprising Starcom MediaVest and ZenithOptimedia.
Phonevalley, which has a presence in France, the UK, Spain, Germany and Italy, develops mobile solutions. Its clients include Paramount, Virgin and Sony.
Alexandre Mars, Phonevalley's founder, will become Publicis Media Groupe's head of mobile for Europe, the Middle East and Africa.
Jack Klues, the Publicis Groupe Media chairman, said: "Mobile communications play an increasingly critical role in the lives of consumers."