South African-based digital marketing group incuBeta has merged with the Netherlands-based digital specialist firm DQ&A in a deal worth more than R1.5 billion.
The R1.5 billion figure is the combined group turnover of both companies on media revenue.
The combined companies specialise in programmatic media, search and Web analytics - delivering measurable results for top-tier clients.
DQ&A and incuBeta have strong back office teams located in Cape Town - those offices will merge early 2016 to create one, central, key management centre, says Dennis Armstrong, incuBeta group executive.
Foreign territories will continue being served by offices located there, he adds.
"With access to new markets and services, this merger represents a big step towards becoming the 'world's best' company in the digital media space, especially from a performance marketing and campaign-delivery perspective.
"Our aim is to leverage our combined expertise into one 'best of breed' option for clients the world over."
The evolving digital market requires companies that understand the technology, are data leaders, and who can give clients a performance-driven solution that results from an integrated approach to search, display and other digital services, says incuBeta CEO, Alan Lipschitz.
"There is now increased depth of talent in our combined teams, with real world innovation and numerous thought leaders in our space," he adds.
Operationally, the merger presents additional opportunities for incuBeta and DQ&A's country offices, with management and operations teams able to expand in search, display and other specialised services, says incuBeta in a statement.
"This merger enables us to provide clients (in SA and abroad) with local knowledge in key territories, combining paid search, display services and data analytics to show greater value to customers across their campaigns."
With more than 90% of digital spend going to paid search and display, it makes sense having them work together in one performance-based environment where local skills are equally as good, if not better, than their international counterparts, says Armstrong.
An added benefit is that clients pay in rands and not foreign currencies for these skills, and that plays a part in helping incuBeta win business from large international companies, he adds.
"This merger is different to other deals in our space in that we are the drivers, pushing global growth from our South African base, as opposed to being the local office of (another) international company," says Armstrong.
"We have created one of the world's largest, independent, international groups of digital agencies," says Rick van Boekel, CEO of DQ&A Media Group. "From a geographical, services and products perspective, we are 100% complementary."
Jonathan Gluckman, incuBeta executive, says the merger is a "shot-in-the-arm" for the SA digital media industry.
The merger is "further proof that incuBeta has the skillsets, expertise and track record to not only compete internationally with confidence but, also, win and keep business from the biggest global brands, he adds.
Future plans include further strategic acquisitions, adding key services and opening markets to the group's global client base, says incuBeta.
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