Publicis, the company that owns several media buying entities including Digitas, Starcom MediaVest Group, Denuo, and ZenithOptimedia, announced the acquisition of digital agency Razorfish from Microsoft for $530 million.
The sale comes with a five-year “Strategic Alliance Agreement,” that gives Publicis’ clients favorable options when it comes to buying display and search ads on Bing from Microsoft. “We’re not going to force these ad placements on our clients, it’s just something extra that we can offer if they’re interested,” David Kenny, managing partner of Publicis’ digital hub VivaKi told Paidcontent. “Given the terms, I expect many will find a reason to do so,” he added.
Publicis’ digital hub VivaKi will house Razorfish. Kenny said that Publicis will keep Razorfish intact (including its brand name and management team), though employees might be moved to other parts of VivaKi. The Seattle-based Razorfish has about 2,000 staffers in its 19 offices across America, Europe and Asia. While Publicis employs roughly 45,000 staffers in 104 countries, Kenny said that Razorfish will bolster its global offerings.
Latin American plans
It is unclear whether Publicis acquisition of Razorfish will impact Razorfish plans to expand in Latin America. Razorfish opened a Brazilian office earlier this year, and plans to open a Mexican and Argentinean office next year (for a recent interview with Joe Crump, Group Vice President, Strategy & Planning at Razorfish, click here). One of the main reasons for Razorfish Latin American expansion is that many Razorfish clients want to expand into that region. This could also be important for Publicis clients, which include Coca-Cola. HP, GM and Fidelity.
However, which of Publicis Latin American digital advertising work will be taken by Razorfish is not clear. Digitas, Publicis´s other major digital agency, expanded into Latin America in November of 2008, when it bought Tribal, a Brazilian digital advertising agency.