Small Direct Shop Gains Capital Infusion, Eyes Buyouts of Its Own
BOSTON--Direct Results Group has been bought by Jordan Industries, a Deerfield, Ill.-based diversified private holding company with annual revenues of $3 billion.
DRG, which has about 30 staffers in offices here and in San Francisco, will retain its name and management team and become a unit of SourceLink Business Services, Jordan's direct marketing arm. Terms of the deal were not disclosed.
"It's really the best of both worlds," said DRG co-founder and chief financial officer Phineas Gay. "We have a company that is still within our control, but now we have the capital to go out and grow as fast as we want."
DRG management--including Gay, president Jim Hackett and creative services director Frank Papsadore-- will report to SourceLink president Hank Riner.
The infusion of capital puts DRG in a position to buy smaller, entrepreneurial companies, primarily Internet content developers, other traditional direct marketing agencies and event planning companies, Gay said.
So what was the attraction of an Illinois holding company to a 3-year-old direct marketing company based in Boston? Riner said it was DRG's vision and creativity that appealed to him. "We talked to a number of [their] customers, who were very pleased with the work they've done, and we knew it would be a great strategic acquisition." Riner contacted DRG after sizing up more than 200 companies, Gay said.
DRG was seeking a partner with deep pockets that "wouldn't tell us what to do," Gay said. Jordan has a reputation for infusing companies with money while remaining hands-off. Past acquisitions include Paw Print Direct Marketing in Elk Grove, Ill., and Zydeco Direct in Markham, Ontario.
DRG's client roster includes Bay State Gas, Bell Atlantic Yellow Pages, Saucony, Cross Pen Computing Group, New York Life Insurance Benefit Services and Real World Technology.
SourceLink is comprised of nine companies that range from a laser printing and mailing firm in South Carolina to a circulation management firm in Illinois to a Canadian supplier of bilingual database management solutions.
SourceLink is one of seven units owned by Jordan, whose other divisions include a telecommunications unit, which owns companies that design and manufacture electronic connectors for cable televisions and computers, and a plastics unit, which supplies components to office suppliers and hardware and houseware stores.