Burnett has bought out the equity of the Leonardo chief executive, Steve Barton, and the creative partner, Gary Sharpen. Although Arc will accommodate many of Leonardo's existing staff, Barton and Sharpen will not be part of the management team and are leaving the Leo Burnett Group.
Arc will continue to be run by its chief executive, John Quarry, and the executive creative directors, Graham Mills and Jack Nolan. In addition, the client services director, Mike Spicer, has been promoted to managing director.
The merger will see Arc inherit clients such as Kellogg, McDonald's, Morgan Stanley and Six Continents UK Hotels from Leonardo, in addition to its own client list, which includes Fiat, Procter & Gamble and Tetley.
The Leo Burnett chief executive, Bruce Haines, said: "The added resource that Arc brings to the group is of enormous benefit and we will increasingly be looking to pursue business on an integrated level.
"Steve and Gary have conducted themselves with enormous grace and professionalism in helping transfer the business. I'm sorry that circumstances won't allow me to continue the close working relationship I had with them."
Speculation that Arc and Leonardo would merge has been rife since the merger of their respective above-the-line partners, D'Arcy and Leo Burnett, last autumn.
Since then, Haines has been vocal about his desire to forge closer working relationships between Leo Burnett and its sister below-the-line agencies, Leonardo, Arc and Masius. This was cited as one of the main reasons behind the decision to move Leo Burnett into D'Arcy's old headquarters in Kensington Village.
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