The agreement, which is subject to approval by Icon Medialab shareholders, includes a $20 million capital investment by Interpublic in Icon Medialab, given it an initial equity position of 20%.
Icon Medialab has more than 400 employees in eight European countries, Asia and Silicon Valley. Under the strategic partnership, Interpublic will designate Icon Medialab as "preferred provider'' of interactive services to Interpublic's major agencies and companies.
In addition to Interpublic's investment, which will support Icon Medialab's expansion, the alignment includes cooperation agreements designed to benefit clients of both companies.
"Interpublic's strategic alignment with Icon Medialab opens a new chapter in delivering Internet and e-business solutions to marketers throughout the world," says Philip Geier, Interpublic chairman-CEO. "In the digital economy, building brands requires going beyond traditional media in order to migrate businesses and their customers to the Web. Icon Medialab has done this successfully for an impressive list of global companies. Our partnership with Icon Medialab will benefit Interpublic's agencies and their clients by powerfully combining strategic, communications and technology leadership."
The relationship will provide the Stockholm-based company access to Interpublic's global infrastructure. Interpublic's holdings include McCann-Erickson Worldwide, Ammirati Puris Lintas, The Lowe Group and Western Initiative Media Worldwide.
A first step in cooperation takes place in Norway, where Thunder House, the interactive unit of Interpublic's JBR-McCann agency in Oslo, will merge with Icon Medialab Norway.
Icon Medialab was founded in 1996 and went public on the Stockholm Stock Exchange in 1998. It reported 1998 net sales of $16 million.
Copyright March 1999, Crain Communications Inc.