CGI Holdings Continues Buying Spree

Acquisition of U.K.-based SEM firm smart interactive adds talent, European foothold.

WebSourced, the search engine marketing (SEM) arm of CGI Holding Corp., expanded its European presence today with the acquisition of U.K.-based smart interactive. Terms of the transaction were not disclosed.

The acquisition gives WebSourced a foothold in the growing U.K. SEM market and brings into its fold well-known industry figure Mike Grehan, CEO of smart interactive. In his decade-long SEM career, Grehan has worked with dozens of FTSE 1000 and Fortune 500 companies. He’s also the author of a best-selling SEM book and a frequent speaker at SEM events.

“His experience, knowledge, and excellent reputation among Europe’s largest companies will allow us to become the first U.S. search marketing company to successfully expand into Great Britain and Europe,” said Andy Beal, VP of marketing for WebSourced.

The company plans to quickly expand the two-person shop and grow its European client base. Websourced currently has about 20 European clients, as well as U.S.-based global clients such as Motorola. Smart interactive has worked with dozens of clients on a consultancy basis but plans to court clients on a retainer model going forward, Beal said.

Forrester Research predicts the European SEM industry will grow by 65 percent in 2005 and reach €3 billion by 2010.

“The market here in the U.K. and Europe is about two steps behind the States as far as search engine marketing goes, but we’re really catching up now,” Grehan said. “As a consultant, most of my work was in the States. But as the industry has been rapidly developing here in the U.K. and catching up in Europe, there’s been more business [in Europe].”

WebSourced, based in Morrisville, NC, sports a roster of more than 1,400 clients, including Lowe’s, NBC, Black & Decker, DEWALT, and CitiFinancial. Its services include organic SEO (define), paid inclusion, and pay-per-click advertising services.

“They approached me with an attractive offer and demonstrated a genuine commitment to emulating the huge success they’ve had elsewhere here in the U.K. and Europe,” Grehan said. “The use of superior proprietary technology at the back end and the professional human touch at the customer end simply endorses the reasons why they have become market leaders.”

CGI, which announced plans in February to change the name of the parent company to Think Partnership, has been very active in the mergers-and-acquisitions space recently. On the SEM side of the business, it announced plans to merge with Proceed Interactive in December and picked up search luminary Heather Lloyd-Martin in December from rival SuccessWorks to be its new director of search strategies.

In January, CGI merged with Raleigh, NC-based full-service ad agency MarketSmart. The company is also growing its affiliate marketing business, acquiring KowaBunga! Marketing last week and PrimaryAds the week before.

“We’re looking to build a network of strong companies that are gong to be able to offer a complete solution to anybody’s needs,” Beal said. “Whether that’s online, offline, marketing, advertising, or affiliate marketing, we’re looking to provide a complete service for our clients.”

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