FSB makes its third M&A – nevertheless it’s not a press workplace

FSB has just made the third acquisition in its history — but this time, the target isn’t a public relations agency.

Brazil’s biggest PR agency by revenue is buying JotaCOM, a move to strengthen its advertising vertical in a market where content and advertising are merging.

The transaction will essentially be an exchange of shares, and will give rise to a new company controlled 60% by FSB Publicidade and 40% by JotaCOM.

The FSB also has a call option to acquire the remainder in five years.

The new company was born with a combined revenue of R$ 40 million and a team of more than 100 employees. The process of integrating the two companies will be led by Alexandre Loures, the head of the private sector at FSB.

Founded in 2005 by Jurgis Figueiredo, JotaCOM serves 25 clients, including names such as SulAmérica, Duolingo, EspaçoLaser, Privalia and Hospital Albert Einstein.

FSB already had a relevant role in the marketing market: last year, its advertising vertical created 65 campaigns, running R$90 million in media.

“But we saw that we needed to bring in more intelligence, staff and expertise,” Marcos Trindade, the CEO of FSB, told the Brazil Journal. “We delved into the market and came across a brilliant model, an agency that works on performance and creation in an integrated way and using a lot of data.”

The acquisition is also in line with FSB’s strategy to expand its presence in the private sector — a move that began with the purchase of Loures in 2018.

Before Loures, half of FSB’s revenue came from contracts with companies and public sector bodies. Today, according to the company, that share has dropped to just 20%, with the bulk of the ‘top line’ coming from 250 private companies.

FSB expects to close this year with a turnover of R$ 400 million — without considering today’s acquisition. The company earned BRL 320 million last year and BRL 250 million in 2020.

Talks between the two companies started from the FSB and started a few months ago. Jurgis, the founder of JotaCOM, said he was not considering selling the business, but saw a lot of value in the way the proposal was made.

“Many foreign groups had already sought us out, but always with the intention of buying the whole business. I’ve never seen the value in it because I want to continue to run the business as closely as I do, with my group in hand and all the freedom it brings to everyday life,” he said. “FSB brought this. In addition, I liked the fact that it was a national group and with a culture similar to ours.”

The acquisition comes a year after FSB bought Giusti Comunicação, another press office.

The company is expanding in three ways: M&As, organic growth and creating new brands from scratch.

In recent years, the FSB has created F5, a growth; Beon, focused on ESG; and the Compass, for content creation.

Diego Ruiz, the partner responsible for M&A, said that the FSB is in talks with other companies and that the focus is on companies that add technology and data to the business.

Pipeline Capital advised FSB on the transaction.

Source: Brazil Journal