Exclusive: MDC snaps up stake in online design firm

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MDC Partners continues its breakneck shopping spree by taking a stake in its sixth marketing firm since January and its second design shop in two weeks.

In a deal to be announced today, the Toronto-based holding company has acquired 50.1% of Hello Design, a boutique specializing in Web design and interactive marketing. The cash and stock deal is believed to be in the $2 million to $3 million range, though neither company would confirm.

International bazaar

MDC, the world's 16th largest marketing organization, wants to wrap up its planned $100 million buying trip by the end of 2006. It is looking at European, Canadian and American sales promotions, database management, customer research management, PR, interactive and product placement companies. It has hired entrepreneur Harry Clark to help assess PR opportunities. MDC expects to invest in three or four more marketing companies in 2005, though nothing is imminent, says Chuck Porter, who has been charged with locating acquisitions in addition to running the Miami hot shop Crispin, Porter & Bogusky. MDC has a 49% stake in Crispin.

The six-person Hello is smaller than many of MDC's recent buys, which include Toronto's Bruce Mau Design, New York ad agencies Kirshenbaum Bond & Partners and Cliff Freeman & Partners, Toronto interactive shop Henderson Bas, and Minneapolis creative shop Mono. Hello, 5 years old and Los Angeles-based, has worked with the Smithsonian, Molson and Sony.

"The fact that someone can and will spend 30 minutes on a Web site is becoming a reality. You can engage an audience much longer, and people are starting to see the value of doing that and doing that well," said David Lai, Hello's CEO-creative director.

MDC had 2003 revenue of $313 million, $194 came from marketing communications companies. Net income was $17 million; $6.4 million from marketing communications.

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