Accenture has acquired Rothco, Ireland’s biggest creative agency group, after several months of negotiations between the two parties. The deal also includes Rothco subsidiaries Guns or Knives and TADATA, its data business.
Discussions between the two companies had been ongoing for the last 10 of months and a deal was finally sealed on Wednesday evening. The acquisition is subject to regulatory approval by the relevant authorities but is expected to be concluded by the end of February 2018.
No details of the purchase price have been disclosed by either party, but industry sources have speculated that Accenture is likely to have paid between €30m-€35m for the agency. If this is the case, it will be the largest M&A transaction in Irish advertising history.
Rothco has undergone a period of rapid expansion over the last five years and it now generates as much as 35% of its turnover overseas. The agency boasts a string of leading blue-chip clients like Heineken, AIB, Failte Ireland, Unilever, Tesco, Aer Lingus, eir, Dublin Bus, Gas Networks Ireland and Rory McIlory Inc.
As a private unlimited company, Rothco does not publish its accounts although industry estimates put it at around €30m in 2016. Since then it has picked up the National Lottery and eir accounts.
The agency was founded in 1995 and has won numerous awards down through the years, including a number of Cannes Lions. Its four shareholders are Patrick Hickey, Patrick Ronaldson, Richard Carr and Paul Hughes. All four directors are staying on with the agency under its new owners.
According to Patrick Hickey, Rothco’s CEO: “Accenture Interactive is a hugely exciting brand to be a part of. It’s shown tremendous leadership in moving towards a new agency model, and we’re very excited to be part of that change.”
“We are proud of the culture of cultures at Accenture Interactive, which has helped establish us as an experience agency. We bring together creative, business consulting and technology excellence, which is a powerful proposition for our clients. Clients are looking to create human-centered brand experiences by connecting every interaction they have with their customers. Bringing Rothco into Accenture Interactive will extend our ability to accomplish this and create the greatest experiences on the planet,” says Anatoly Roytman, Accenture Interactive’s Europe, Africa and Latin America lead.
Alastair Blair, country managing director of Accenture in Ireland, added: “We’re delighted about welcoming such a talented group of creative professionals into the Accenture family. Rothco is a great fit for our business in Ireland. Dublin is not only an innovation and technology hub, it is a creative and cultural capital. Experience is the new battleground and we are creating new ways for our clients to engage with their customers. Once the acquisition is completed, more than 150 professionals from Rothco will join Accenture to help our clients innovate and lead in their markets.”
It is understood that Rothco will retain its brand identity and function as a stand-alone agency within Accenture while tapping into the global technology resources and client base of Accenture. In addition, Accenture Interactive says it has plans to scale Rothco’s creative and brand marketing capabilities internationally.
Accenture Interactive is part of Accenture plc, a Nasdaq quoted company that has its registered headquarters in Dublin. In the year to the end of August 2017, Accenture reported global revenues of $34.85bn and profits of $4.46bn. The company has over 425,000 people serving clients in more than 120 countries.
The company is structured around five distinct operating groups – communications, media & technology, financial services, health & public sector, products & resources. Turnover generated by its communications, media & technology division – which includes Accenture Interactive – amounted to $6.88bn in the year to the end of August 2017 while it generated an operating profit of $1.04bn.
Accenture Interactive essentially works with brands to transform their customer experiences across the entire customer journey. Through its connected offerings in design, marketing, content and commerce, it helps these clients create new ways of doing business in what has become an increasingly experience-led economy. Accenture Interactive was also ranked as the world’s largest digital agency by the annual Ad Age Agency Report.
Earlier this year, Accenture said that it was planning on spending as much as €1.8bn on acquisitions to expand its business across all its key business divisions. Since it was formed in 2009, Accenture Interactive has snapped up 22 agencies across the creative, design, e-commerce and digital sectors.
This year alone it has bought agencies like Kunstmaan in Belgium, Altima in France, Sinner Schrader in Germany, The Monkeys and Maud in Australia as well as Media Hive, Clearhead, Wire Stone and MATTER in America. Last year it bought the UK creative agency Karmarama, sending out a signal to the wider market of its intent to move into the traditional advertising space. Earlier this year, Accenture Interactive introduced Fjord- its design agency- to the Irish market with the opening of an office in the company’s Dublin HQ.