Scandinavian net firms merge to survive

NEWS Icon Medialab, the pan-European internet consultancy is to merge with its Dutch rival Lost Boys. The Stockholm-based consultancy is acquiring Lost Boys for SEK 127.5m ($12m) in all share deal. The company said it will be making undisclosed number of redundancies in various locations. Icon gains a substantial client base from Lost Boys, such as Postpank, Audi/Volkswagen, Orange and Novartis. Icon will also raise SEK180m ($18m) funding through a rights issue, which the company claims will secure its future. Icon had hoped to get bought out earlier this autumn, but the deal collapsed because of changes made in Swedish taxation system, according to Scandinavian newswires. A recent survey found out that three-quarters of Swedish IT companies listed on the Stockholm Bourse will not be in business by 2004. The research from Insight Lab said internet consultancies, such as Framfab and Icon Medialab, were most at risk to be obsolete by 2004.