The takeover, which is to be completed in the second quarter of 2020, is still subject to the approval of the competition authorities. The German publishing group Random House was so far fully owned by Bertelsmann and it is now to become part of Penguin Random House based in New York. “Nothing will change for the employees in Munich,” Thomas Rabe told the German Press Agency.
The Bertelsmann CEO emphasized that this step would have no consequences for the German location. The book publishing group will then include more than 300 individual publishers worldwide.
“The book business is part of Bertelsmann’s identity,” said Rabe about the reasons for the acquisition of the remaining shares. “The U.S. remains the largest market for books. The company continues to see the greatest opportunities for growth here.”
“I’m personally very excited to welcome the colleagues and authors of Germany’s Verlagsgruppe Random House into our global community of publishing imprints at Penguin Random House. With Bertelsmann bringing all of us together, we will further enhance our shared strengths,” said Markus Dohle, CEO of Penguin Random House and a member of the Bertelsmann Executive Board.
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The takeover will make waves in the publishing world
The Spanish-speaking market, India, and China also have great potential. The takeover will increase Bertelsmann’s shareholders’ share of consolidated net income by more than $77 million (€70 million) a year, said the Bertelsmann CEO. By 2018, the group had generated a profit of $1.22 billion (€1.1 billion).
Bertelsmann and Pearson merged their publishing businesses back in 2013. The Gütersloh-based company gradually increased its stake to 75%. Bertelsmann’s book business generated sales of $3.78 billion (€3.4 billion) in 2018. That is almost 20% of Bertelsmann’s total revenues of $19.6 billion (€17.7 billion) in 2018.
In addition to the book division, the group includes the listed and advertising-financed European broadcasting group RTL, the Hamburg publishing house Gruner+Jahr, the music subsidiary BMG, the service subsidiary Arvato, printers and an investment and education division.
Bertelsmann is largely owned by foundations, including the Bertelsmann Foundation. The Mohn family holds the remaining shares of almost 20%.
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First published in Schwarzwaelder Bote, a third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.
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