Communications Planning Hotshop Naked Is Acquired

Cash From Australia's Photon Group to Aid Global Expansion

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NEW YORK ( --- U.K. planning agency Naked Communications has been acquired by Australian holding company Photon Group in a deal that includes an upfront payment of $38 million in cash.

The agency, which opened in the U.K. in 2000, is credited with putting communications planning -- media planning that focuses on all consumer touch points rather than traditional ad buys -- on the map. After turning the ad model on its head in the U.K., Naked built out its operations in the U.S and around the world.

Major marketers
Naked works with major marketers including Johnson & Johnson, Kimberly-Clark, Coca-Cola and Nokia, and has about 200 employees working in eight countries. Its total revenue in 2007 was about $31 million, with the majority coming from the U.K., according to the Photon Group.

According to executives familiar with the situation, Naked has been approached by several holding companies and private-equity firms with acquisition offers. Besides the cash upfront, the deal with Photon includes two deferred payments tied to growth targets between 2008 and 2011. Naked is looking to expand its presence in China, India and other marketers.

John Harlow, one of Naked's founding partners, said the agency has been looking for a partner to help support its continued global expansion. The agency decided to go with Photon because "they fit our culture," Mr. Harlow said. Photon is "brilliant," he said. "They believe in our growth and they want to help us expand without controlling us."

Photon's expanding reach
Photon owns about 40 marketing-services companies. Its biggest presence is in Australia, where it owns the Bailey Group, a retail-marketing company based in Melbourne. In recent years, the company has been looking to expand its marketing services beyond Australia by acquiring shops in the U.S. and the U.K. and expanding its operations into Asia, according to published reports.

The company recently purchased two digital shops in the U.S., Los Angeles-based Findology Interactive Media and Houston-based OB Media. "This is a hugely significant deal for Photon and a major boost to our business," Tim Hughes, executive chairman, said in a statement. "Naked is unquestionably the world's leading communications-strategy consultancy, bringing a whole new perspective to the industry which has underpinned their remarkable growth across a number of different countries and markets."
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