Database marketing and datawarehousing organization, Acxiom Corp is to buy one of its rivals, May & Speh in a stock swap valued at $625m. The acquisition is the biggest Acxiom has ever attempted, and if all goes to plan and regulatory and shareholder approval is received, the deal will close in August. May & Speh was established in 1947 and specializes in direct marketing and IT outsourcing. The combined might of the companies which have historically been rivals will create a company generating $700m by the end of fiscal 1999, according to Acxiom spokesperson Lesley Rasmussen. Acxiom achieved $400m for its last financial year, which ended in March. When the acquisition is complete May & Speh will operate as a division of Acxiom under the name Acxiom May & Speh and will be located at its current headquarters in Downers Grove, Illinois. While May & Speh, has been in existence for over 50 years, it only went public two years ago, on the Nasdaq exchange. Acxiom headquarters will remain in Little Rock, Arkansas. May & Speh’s 650 staff will join Acxiom making a combined workforce of just over 4,000. Acxiom had been in merger talks with May & Speh before it went public, but they broke down. More recently the companies have been working together on a joint project, and it was just ten days ago that the talks of several years ago resumed and the companies came to a hasty conclusion. Acxiom is putting special emphasis on this purchase and believes it has a real chance of conquering the direct marketing space. The company is more used to purchases of between $20 and $40m, but Rasmussen commented: We have realized that if we are to compete seriously in the future, size is important. Acxiom expects the transaction to be tax free and accounted for as a pooling of interests. Under the terms of the agreement, Acxiom has granted May & Speh an option to purchase up to 19.9% of Acxiom’s issued and outstanding common stock at an exercise price of $23.55 per share. In return May & Speh has granted Acxiom an option to purchase up to 19.9% of its stock, at $14.96 per share.
