Xceed buys into UK market for $75m.

US new-media agency Xceed (www.xceed.com) has gained a foothold in the UK following its $75 million purchase of London-based counterpart methodfive (www.methodfive. com).

US new-media agency Xceed (www.xceed.com) has gained a foothold in

the UK following its $75 million purchase of London-based counterpart

methodfive (www.methodfive. com).



Xceed is funding the deal with around $70.5 million in stock and $4.5

million cash and, according to a spokesman, will now move into the top-10

list of global new-media specialists by size.



Amory Hall, managing director of methodfive in London, said: ”This deal

gives us everything that we would have gained through an IPO in a year

without any of the uncertainties of where the market might be

heading.”



He added: ”It means we get a great business partner with zero duplication

and overlap in core skills, plus the investment to grow in emergent areas,

such as intra/extranets and e-marketing.”



According to Hall, the merger takes Xceed by revenue and headcount to

around number five or six in terms of global new-media agencies, but it

intends to expand still further. ”This is an ambitious company that wants

to scale up very fast and establish a dominant position with global

brands,” he said. ”Methodfive has excellent partnerships which come

together with Xceed’s to ultimately mean that we can help it to deliver a

service that much faster.”



Methodfive was founded in 1995 and specialises in media, publishing,

healthcare and retail, with annual revenues of $20 million. In October

1999, accountancy firm PricewaterhouseCoopers took a significant stake in

the agency in return for providing access to a global pool of management

and technical talent.



Its client list includes The Economist Group, The New York Times

Corporation, Warner Lambert, Fox Networks, BBC Worldwide, Oxford Health

Group, CDNOW and EW Scripps.



The combined group employs around 500 people.



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