The Works, the 15-year-old independent agency founded by Damian Pincus and Kevin Macmillan, has been bought by digital consulting business RXP.
It is the second major acquisition of an independent creative agency in as many months, following Accenture Interactive's acquisition of The Monkeys. It had been tipped by many as the next indie that would sell.
RXP says it hopes the partnership will “create some digital waves” in the industry and help it capitalise on the “$79 billion digital economy” by strengthening its ability to offer an “end-to-end delivery capability”.
Similar to the idea behind Accenture's acquisition of The Monkeys, RPX and The Works aim to bring together brand strategy and digital to drive deeper engagement with clients, develop higher value work and increase cross-sell revenue opportunities.
Damian Pincus, co-founder at The Works, says: "In RXP we have found a future focused, innovative and culturally aligned partner at a time when the business of marketing communications continues to undergo significant disruption.
“Clients increasingly want to engage with consumers at a deeper and more personal level and as digital transformation specialists RXP have a wealth of experience in this area. This is an exciting partnership and will complement our core brand strategy and creative offering enabling us to further deliver for our clients and people."
RXP CEO Ross Fielding says: "The acquisition of The Works just made sense. It is a really strong fit with RXP’s evolving business model as we continuously seek to grow our digital services offering. The future is all about digital, and the acquisition of The Works significantly enhances our capabilities in this area.
“In addition to extending RXP’s already strong digital customer experience delivery capability, it also increases our presence in NSW and further diversifies our customer and revenue base which is crucial for a sustainable business. We strongly believe this acquisition will allow a deeper level of client engagement and, therefore, higher client satisfaction.”
The deal, which is funded by a mix of RXP's cash reserves, debt facilities and placements from other funding sources, is expected by boost RXP's earnings per share by over 10% in 2018. It also expects $1.5m in cost savings synergies.
Having established itself in Sydney in 2002, The Works has developed a unique set of services and a refreshing client approach that has seen them named as Independent and Customer Experience Agency of the Year, in addition to winning local and international awards for advertising effectiveness.
Clients on The Works' list include Optus, News Corp, Masterpet, Visit Canberra, Tata Beverages, ING and Sanitarium.
The Works is currently the AdNews Customer Experience Agency of the Year. It also has a significant data business, and recently launched On Message, a division dedicated to messenger apps a year ago.
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