Both the companies have signed a memorandum of understanding to this effect. The options have been kept open and the modalities for the purpose are in the final stages. The deal will be signed within this calendar year, Everest Integrated Communications managing director Ajit Shah told The Financial Express.

He said Everest would offer a minority stake initially to the leading advertising firm in the world. DY&R would also have the option to increase to majority at a later date if it so chooses. ``The price and the exact equity to be picked up has not been decided,'' Shah said, without dislcosing the equity base and shareholding pattern of Everest.

In line with these developments, the company had changed its name from Everest Advertising to Everest Integrated Communications. Dentsu Young & Rubicam is a joint venture between Dentsu of Japan and the US-based Young Rubicam.

Industry sources have said that the company had been scouting for a joint venture partner for the last two years to come out of the dismal situation. Everest had also negotiations with leading domestic players in this regard but a deal was not materialised.

``The tie-up is very critical and the company can offer international quality of work to its clients. The focus will be on this and not on growing new businesses. However, we do not expect any major deviation from our core activities,'' company sources said.

Significantly, the company, which has a strong presence in South India, had closed down its branch office in Bangalore and moved to new premises owing to obvious reasons. At present Everest has regional offices in New Delhi, Chennai, Hyderabad and Bangalore with its headquarters in Mumbai.

The major clients of Everest in Hyderabad were Eenadu group of publications, a part of Vizag Steel, and Rank Aqua, while its Bangalore branch handles Molex India, among others. It is understood that currently Everest has accounts of some infotech companies handled by its Hyderabad division. However, the company has not figured in last years' Advertising & Marketing listing.

According to sources, the advertising industry in India expects a major shakeout in coming years. ``The route of mergers and acquisitions is likely to emerge as the main strategy among ailing and other local players to beat the multinational competition,'' said a senior executive with Corporate Voice, Bangalore.

``With the advent of software technologies several small players are keeping a low key. In addition to this, the number of corporates, who have been setting up their own in-house facilities, is increasing in the country. Access for funds in order to diversify into new areas has always been a major hurdle for small firms,'' analysts said.