days after announcing it had received $62 million in
new venture funding, interactive online marketing agency
iCrossing Inc has more than doubled in size overnight
by acquiring web development agency Proxicom for an
undisclosed sum. The merger, which increases iCrossing''s
employees from 200 to 550, is in line with the company''s
ambitious designs to become a top full-service digital
agency. The two companies had been in talks for about
three months prior to Monday''s announcement, said iCrossing
President Don Scales.
gives iCrossing access to an entirely new set of clients,
as there is virtually no overlap between the two companies.
Of particular value is Proxicom''s automotive vertical,
which includes Chevron and Toyota. Du Pont is another
key Proxicom client.
the terms of the deal were not released, chief executive
Jeff Herzog indicated that some, but not all of the
new funding was used in the deal. The seller was turnaround
firm Gores Technology Group LLC of Los Angeles, which
acquired Proxicom from Dimension Data Holdings plc in
2004. Dimension Data, in turn, had taken Proxicom private
in a $448 million deal three years earlier, when web
development firms attracted highly inflated valuations.
to Herzog, iCrossing was already profitable when it
took in the $62 million round, and has raised a total
of $110 million, including $92 million last summer.
Though iCrossing has never released revenue figures
of its own, the company did not dispute a report published
in April 2007 in Advertising Age pegging its
2006 revenue at $63 million. The same report estimated
Proxicom''s revenue at $66 million, but gave it a slower
growth rate. Herzog says that Proxicom is profitable
too, and predicted that the merged entity would generate
revenues in excess of $100 million this year.
you combine the numbers, we''re now the largest independent
digital marketing agency in the world," Herzog
said. The Scottsdale, Arizona-based iCrossing "will
continue to be a predator and not prey" as it contemplates
new acquisitions, both to bolster its technology capabilities
and widen its geographic reach.
of Proxicom''s management team will remain intact, though
the company''s CEO and CFO are Gores employees. Proxicom
chief operating officer Blue Van Dyke will guide Proxicom
through the integration process, with Herzog and Scales.
in 1991, Proxicom went public during 1999 and once generated
revenues in the $200 million range, but it lost business
during the dotcom bust. After scaling back its ambitions
and changing ownership twice, it acquired healthcare
information technology consultancy Daou Systems Inc
also see : Goldman lead finances
$62 million for digital marketer iCrossing