A.C. Nielsen Australia has agreed to acquire key rival AGB McNair, for an estimated $18 million. The two will continue to operate separately under existing managements.
The immediate benefit to Nielsen is that it will gain the use of some of AGB's current services, including its strong Brandscan market research business.
The two companies have been bitter rivals in both marketing and media research, particularly since AGB lost the national TV networks' audience measurement contract to Nielsen's PeopleMeter system, worth an estimated $5 million a year, in 1990. AGB, which had previously held a monopoly in Australia for telecast audience measurement, still provides radio audience information.
AGB Executive Chairman Malcolm Spry owns 25% of the company, 18 senior staff members hold 67% and merchant bank Barclays De Zoete Wedd, has 8%.
Nielsen made an unsuccessful bid for AGB in 1992 following the death of the previous owner, Robert Maxwell, but lost to the management buyout.
Mr. Spry, a former managing director of Mojo MDA, said he would remain with AGB for at least two years. His contract as chairman of ad agency BAM/SSB, owned by Dentsu, Young & Rubicam Partnerships, expires in May, but Mr. Spry will stay on there until a reorganization is complete.
"It was a big decision to sell AGB," he said. "It has been trading profitably since the management buyout, and profits have increased."
He said Nielsen approached AGB to buy its Brandscan brand share service earlier this year.
"That was the jewel in our crown, and we had not contemplated selling," Mr. Spry said, "but when someone makes a serious offer, you have to take it seriously."