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The network is being created on the back of a realignment of the digital and direct agency Digitas, which was recently acquired by Publicis Group for $1.3bn (£653bn). It has led to the departure of Colin Hearn, Dialog's worldwide chief executive.

Martin Reidy, formerly president of Modem Media, will head up the the new venture as chief executive officer. He will also assume the same role at Publicis Dialog, which has offices in more than 40 countries.

Reidy will report to Richard Pinder, chief operating officer at Publicis, and will sit on the worldwide executive committee of the network.

The new offering will expand internationally by aligning with Publicis Dialog operations in the US and Canada, Europe, Middle East, Asia, Latin America and Australia.

Reidy will oversee the executive teams for Publicis Modem and Publicis Dialog, which also operates in the interactive, CRM, and promotions arena. Further details of the new organisation will be announced over the coming weeks.

Together Publicis Modem and Publicis Dialog employ more than 2,000 employees worldwide.

Up until now, Modem Media has been mainly based in San Francisco and Norwalk, Connecticut, in the US, and London. Modem Media in the UK will now be rebranded as Digitas London.

The newly named Digitas London will continue to work on its roster of clients, including General Motors Europe and Kraft Foods, but will drop the responsibility for one of its leading clients HP, which will be controlled by Publicis Modem.

The Modem Media headquarters in San Francisco will become Publicis Modem's global headquarters.

Olivier Fleurot, executive chairman of Publicis, said: "This move will help us to create more innovative solutions for our clients. The demand for online services is growing rapidly and this move confirms our commitment to strengthening our capabilities in the digital world. We are very happy to welcome our Modem Media colleagues into the Publicis family."

Pinder said: "When Olivier and I arrived, we made the digital future of our industry a top priority. This is a major step towards that future.

"In bringing Modem's skills to bear on Dialog, we will be both expanding geographically as well as increasing our range of service capabilities. The combination of Publicis Dialog and Publicis Modem will deeply increase our holistic strengths."