Arun Sudhaman 23 Jun 2011 // 11:00PM GMT
CANNES--MDC Partners, the holding group that owns a string of US PR agencies, is actively seeking acquisitions outside its home turf of North America.
MDC Partners founder and CEO Miles Nadal told the Holmes Report that Europe and Brazil are top priorities for the group’s foreign expansion, in line with client needs. He added that MDC’s PR firms, which include Allison & Partners, Sloane & Company, Attention and HL Group, “are looking at international expansion”, and that the group is also searching for acquisitions of “standalone international firms.”
Currently, only Kwittken & Co - among MDC’s PR firms - counts an international presence, via an office in London.
Nadal’s comments represent a marked departure from his attitude 12 months ago, when he told the Holmes Report that geographic expansion beyond North America was not a priority.
After buying a number of PR firms, MDC’s acquisitive streak has slowed over the past year despite Nadal’s repeated assertions of a $200m warchest. He pointed out that “the low hanging fruit of great firms has been harder to find,” but added that the group will make “one or two deals” in the next six months.
“I still think that the opportunity, the smartest thinking, the most innovative campaigns, and the greatest conversations between technology and communications in happening in PR. Clients have figured out that is the case and have figured out that small, entrepreneurial and agile is the future.”
In addition to a continued interest in social media capabilities, Nadal believes that MDC must bolster a relatively underweighted healthcare offering. “We have the wherewithal to spend $200m on acquisitions in the next couple of years. We have more capital than we have great firms that meet our criteria.”
He also claimed that MDC’s approach, which usually consists of buying a 51 percent stake in its firms, is attracting increasing interest from PR agencies. “No firm would be too bold for our appetite, and normally that’s the exact opposite of other organisations. That message is now getting out in a big way.”