-By Steve McClellan

NEW YORK The Nielsen Co. has agreed to acquire IAG Research for $225 million, the companies confirmed. IAG is a privately held firm here that measures consumer engagement with television programs, national commercials and product placements. 

The acquisition will be achieved through a merger of IAG with a wholly-owned subsidiary of Nielsen in which IAG stockholders will receive cash for their shares. The transaction is subject to anti-trust regulatory review and other typical closing conditions. Nielsen intends to finance the transaction through the issuance of notes, existing facilities and cash on hand.

IAG co-founders and co-CEOs Alan Gould and Ken Orkin have agreed to join Nielsen following the completion of the acquisition in the second quarter.

IAG conducts research to measure the effectiveness of advertising and program engagement across TV and the Internet. The company lists about 75 clients on its Web site, including blue-chip marketers such as General Motors, Ford, Microsoft, Anheuser-Busch, Procter & Gamble, Verizon, eBay, most of the major film studios, the major broadcast networks and many cable properties.

"IAG will add a new dimension to Nielsen's media business and will be the cornerstone for a new analytics practice that will provide our clients with even greater insights and clarity," said David L. Calhoun, Nielsen chairman and CEO, in a statement. "We are excited by the energy the IAG team will bring to the multiple opportunities they will have at Nielsen. Overlaying their perspective with the vast array of industries and technologies we touch gives us an opportunity to bring greater clarity and creativity to our work on behalf of clients."

Added IAG's Gould and Orkin: "By working within Nielsen we will also be able to make the company's services available to a wider base of clients. In an increasingly fragmented media landscape, we believe strongly that advertisers and media companies need the insight that Nielsen and IAG can provide together." 

IAG was founded in 2000. The company reported revenue of $35 million last year.

Adweek is a unit of the Nielsen Co.