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S4 Capital’s MediaMonks merges with Silicon Valley’s biggest digital agency

Firewood, which operates by embedding employees into client marketing teams, has around 300 staff across 7 locations in the Americas and Europe

S4 Capital PLC - S4 Capital’s MediaMonks merges with Silicon Valley’s biggest digital agency

S4 Capital PLC’s (LON:SFOR) digital production firm MediaMonks has merged with Firewood, Silicon Valley’s largest independent digital marketing agency.

The marketing firm, headed by ex-WPP PLC (LON:WPP) boss Martin Sorrell, said the merger would cost US$112.5mln, to be paid half in cash and half in shares, with another payment of US$37.5mln if Firewood met its budgeted earnings (EBITDA) target for 2019.

READ: Martin Sorrell called to give evidence in Dutch court case amid spat between Mediamonks bosses

The agency is targeted to report revenues of US$73mln for the year, a 30% rise on 2018, and currently employs 300 people in 7 locations across the Americas and Europe.

Firewood aims to reduce the inefficiencies of traditional marketing agencies by embedding their employees into its clients’ internal marketing teams, with Facebook, Google, LinkedIn and Salesforce among its customers.

Sorrell. Who serves as S4’s executive chairman, said the merger was “a further step” for the company in creating a “new era communications leader”, while also expanding the group’s size to 1,800 employees across 23 countries.

In mid-morning trading on Tuesday, S4 shares were up 6.6% at 149.3p.

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Price: 386 GBX

LSE:SFOR
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Market Cap: £2.05 billion
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