Bertelsmann plans to forge largest book publisher
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E-mail Xinhua, October 30, 2012
Bertelsmann, Germany and Europe's largest media group, announced Monday an ambitious deal to merge its subsidiary Random House with arch British rival, Penguin.
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Bertelsmann said it struck a deal with the British publishing house Pearson to create a new giant on the international book market. [File photo] |
The much-hyped merger is aimed at forging the world's largest book publisher amid a fast changing publishing landscape, particularly the rapid take-up of ebooks.
The deal may come as a blow to Rupert Murdoch, the head of News Corp, who had offered 1 billion pounds (1.6 billion U.S. dollars) to purchase Penguin and merge it with HarperCollins Publishing Group, a subsidiary of Murdoch's media empire.
Bertelsmann said it struck a deal with the British publishing house Pearson to create a new giant on the international book market, as both companies agreed to integrate their book publishers Random House and Penguin Group.
The new company will be named the Penguin-Random House, with Bertelsmann holding 53 percent of the shares, Bertelsmann announced.
The deal is expected to generate annual revenues of about 2.5 billion euros (3.2 billion dollars) and help the new entity capture one-quarter of both the UK and U.S. book markets, when it gets official consent and becomes operational in the second half of 2013.
Bertelsmann CEO Thomas Rabe called the merger a "milestone not only for Random House, but for all of Bertelsmann."
He added it would significantly strengthen the core business of Bertelsmann, and enable both publishers "to even more effectively present their books in traditional and in digital formats and distribution channels for the future."
The cartel between Penguin and Random House is the first such deal between the world's top six publishers, others being Hachette, HarperCollins, Macmillan and Simon & Schuster.
"Together, the two publishers will be able to share a large part of their costs, to invest more for their author and reader constituencies and to be more adventurous in trying new models in this exciting, fast-moving world of digital books and digital readers," Marjorie Scardino, Pearson's chief executive, said.
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