Snyder Buys German Pharma Firm as Seventh Euro AcquisitionBETHESDA, MD - Snyder Communications last month entered the German market through the $58 million purchase of MKM Marketing, a Munich-based pharmaceutical marketing firm. It is the 7th European firm Snyder has bought since 1997.
CEO Daniel Snyder said it won't be the last. "We are looking at other markets and want to expand in Germany through purchase of a direct marketing company and another pharmaceuticals firm."
MKM, a Snyder statement said, "is a leading provider of outsourced pharmaceutical sales and marketing solutions." It has a sales staff of 350 people and serves such clients as Bayer, Glaxo, Merck and SmithKline Beecham.
"MKM has an organization that fits us like a glove," Snyder said. "It has a content division that develops CD-ROMs for new pharmaceutical products and a continuing education program for physicians." Sales are well over 40 million German marks ($23.5 million), he added.
Five of the companies Snyder has bought in Europe are in the health care field and two are DM companies, most notably Brann Ltd., the largest direct marketer in the UK, and "that makes us Number 1 in Great Britain."
His overall strategy, Snyder said, "is to become the world leader in the marketing of global pharmaceutical manufactures and that encompasses contract sales, tactical pieces and the communications content area."
DM is a key component of that strategy. It is already "the largest part of our business," accounting for some 45 percent of total revenues. Snyder sees great opportunity for his firm as more and more pharmaceutical companies move into the direct marketing of their products.
Snyder does his homework. "It took us a year to find the right German company. We had to kiss a lot of frogs first. But we are well known and well established in the marketplace and we know the key players."
MKM, he noted, was not for sale and it took some wooing to fashion an acceptable deal. "We look at trends first, and then at the underlying characteristics of the marketplace.
"Then we work our way through to which organization fits the growth characteristics we are looking for. We do this on a country by country basis and keep a global perspective in mind. We spend a lot of time on research.
"We don't acquire an organization unless it has very strong management in place that is committed to stay for the long haul. And we've had very little management turnover throughout our entire organization."
In structuring foreign deals Snyder used local talent because of the language barrier. In Germany he retained the services of Lazard Frere's German office, the same company he used for earlier French acquisitions.
The company's management systems tends to be very decentralized, as befits a company that has made so many acquisitions in the US and abroad, but retains "a very unified approach to success."
To the outside world, particularly to Wall Street, "we are conservative in our expectations but we are aggressive as far as our internal expectations go and that approach has been an impeccable success in the last two years of being a public company."
Snyder added that while he did not enjoy current "marketplace volatility, we have held our own. We're still up a 100 percent over the IPO figures."
In a related development, Snyder announced last month that another subsidiary, Bounty Group Holdings, won a contract to launch a brand-building program for a UK energy company, Midlands Electricity (MEB).
Bounty will develop an incentive-driven campaign to increase awareness of MEB's "Save Your Energy" program and increase parental awareness of safety measures for children.
"Midlands Electricity represents another of our long-term client relationships. As with all our blue-chip clients, we have every intention of providing Midlands with the enhanced value-added services it needs as its business continues to grow," he added.
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