The Minneapolis public relations agency Padilla Speer Beardsley, a 52-year-old Twin Cities institution, is acquiring Virginia-based CRT/tanaka in a deal that will make the two agencies one of the top 10 independent PR firms in the United States.

The move substantially strengthens Padilla's presence in the ­important New York market and gives it first-time offices in Washington and Los ­Angeles.

The combined firm, which will retain headquarters in the larger Minneapolis office, will be called PadillaCRT.

Terms of the acquisition were not disclosed. The deal, which was announced Monday, is expected to be finalized late next month.

Padilla's Lynn Casey will retain the title of chairman and CEO of the merged firm. CRT's Mark Raper will be its president.

"This relationship has been long in the making," Casey said in an interview. "We know each other very well. We've done joint presentations [to clients] and have worked together."

Lynn Casey

Casey said the acquisition/merger possibility emerged earlier this year as she was looking for partners to bulk up Padilla's New York presence where the agency had a staff of eight handling such clients as Coppertone and I D A Ireland, an Irish company that explores business opportunities with U.S. firms.

"I queried several firms and nothing felt right and then I got a call from CRT asking about our [employee] ownership structure. They wanted an ESOP like we had. We started talking and it didn't take long to realize we should consolidate our [former] loose collaboration."

The new firm will have 200 employees and annual fee revenue of more than $30 million. It will remain employee-owned.

Padilla's book of business includes BASF, Allianz Life, Cargill, Coppertone, ­Glastron, Land O'Lakes, Rockwell Automation and UnitedHealth Group.

CRT will bring a list of ­clients from the food, nutrition and consumer sectors including Avocados from Mexico, the Federation of Quebec Maple Syrup Producers, BISSEL Homecare, Charles Schwab & Co., Sprint Nextel and Air New Zealand.

"This combination makes strategic sense for our ­clients and our employees," said Raper, CRT/tanaka's CEO.

Under the new arrangement, PadillaCRT will have a New York office of 33, which is a big step up for Padilla.

"There are some clients for whom size does matter," Casey said. "We've seen that in our New York office, which is why we started looking for consolidation in the first place. Some decisionmakers viewed that as a service office" rather than a strategy center for clients.

"We hope to remove that barrier," Casey added. "Washington and Los Angeles were also markets we wanted to make an investment in."

CRT/tanaka also has offices in Richmond and Norfolk, Va. Its headquarters are in Richmond and New York.

Casey said both agencies have grown beyond the traditional boundaries of public relations services to include paid media (advertising), ­digital opportunities, social media strategies, internal communications and crisis communications.

"It's a new world where more and more clients want agencies that can execute on paid media, earned media, owned media and shared media strategies," Casey said.

Two years ago, Padilla Speer Beardsley conducted a 50th-anniversary celebration that honored founders Don Padilla and David Spear and, ­eventually, partner John Beardsley, all of whom have since died.

Casey said family members were informed about the name change.

"It's like a law firm. Padilla has always been the predominant name," Casey said. "This is no way disrespectful of the other founders. It was a matter of practicality. The spirit of Speer and Beardsley will go on even though their names will not."

David Phelps • 612-673-7269