In a global media announcement, VNU NV announced on Monday that it will acquire ACNielsen in all cash transaction for $36.75 per share representing $2.3 billion.

VNU owns 80 per cent in ORG-Marg, and with the proposed merger, would own 100 per cent in ACNielsen in India. According to industry sources, the merger is a win-win situation for both ORG-Marg - which has been consolidating its strengths to combat ACNielsen's presence in India - and ACNielsen, which is striving to get a deeper penetration into the Indian market.

The merger, point out industry observers, would also widen the gap in market leadership between ORG-Marg and competitor IMRB.

ORG-Marg has a 31 per cent share in the Rs 300 crore research market in India. IMRB is a close contender with a 21 per cent share of the market. ACNielsen has picked up a 7 per cent to 8 per cent of the market. With the proposed global merger, the strength of the combine will consolidate to about 40 per cent, making IMRB a distant second in ranking.

The move is definitely beneficial to ACNielsen as India - which was the only market in Asia where it was not the leader. ACNielsen commands a leadership position in all other Asian markets. The Indian impact would enable it to get access to the formidable delivery system of ORG-Marg.

ORG-Marg operates 13 offices in India, and reaches out to 123 towns with a permanent field force. It has an employee strength of 1,700. On the other hand, ACNielsen has three offices and a strength of under-300 employees.

Besides, ORG-Marg would draw upon ACNielsen's strengths in Internet research. Industry sources said that eRatings, the Internet research arm of ACNielsen which is a leader in international Internet ratings (excluding North America) - complementing VNU's majority interest in NetRatings - would most certainly mark its presence in the Indian market.

However, the modalities of the global merger impact in India are still unclear as to whether ORG-Marg and ACNielsen would eventually merge into a single entity under the VNU umbrella, or operate as separate divisions in the competitive field of syndicate research.

Industry sources pointed out that so far as syndicate research and television ratings are concerned, it would be wasteful for the two entities to operate separately to invest in bringing out, simultaneously, two syndicate researches, two TV ratings, two readership surveys and two retail surveys. A merger of interests in these fields may occur with immediate effect.