Lord Ashcroft, the deputy chairman of the Conservative party, has emerged as the largest shareholder of a new digital advertising agency.

Lord Ashcroft will own, either directly or indirectly, almost 37% of the venture, called Digital Marketing Group.

DMG has been launched by Ben Langdon, the former chief executive and chairman of Euro RSCG, which is part of the Havas group run by French financier Vincent Bolloré.

DMG is acquiring an AIM listing by merging with a shell company incorporated in Belize and launched on AIM last October as Seashell 2. Lord Ashcroft is the principal shareholder.

DMG is in the process of acquiring its first two agencies, Dig For Fire, a direct marketing company, and digital marketing outfit HSM.

According to research firm Marketing Services Financial Intelligence, the two companies are being acquired for a total of £16m in cash and shares.

Dig for Fire is being purchased for £3.9m in cash and £7.8m in shares; HSM for £4m in cash and £8m in shares.

DMG has been incorporated in the UK and will not inherit Seashell 2's offshore status.

· To contact the MediaGuardian newsdesk email editor@mediatheguardian.com or phone 020 7239 9857. For all other inquiries please call the main Guardian switchboard on 020 7278 2332.

· If you are writing a comment for publication, please mark clearly "for publication".