German media group Bertelsmann is to become the sole owner of Penguin Random House, following the decision by the latter’s co-owners Pearson to sell its remaining 25% share to the German group. The deal is worth $675m and is expected to be completed in 2020. Once the ink has dried Bertelsmann will be the sole owner of the world’s biggest trade publishing group.
Bertelsmann already owned 75% of PRH. It bought the then separate Random House in 1998, and then merged Random House with Pearson’s Penguin in 2013 to form Penguin Random House, taking a 53% stake. In 2017 it acquired another 22 % of the shares in Penguin Random from co-shareholder Pearson.
Thomas Rabe, Chairman and CEO of Bertelsmann and Chairman of the Board of Directors at Penguin Random House, said: “The increase to 100% is a milestone for Bertelsmann. We will become the sole owner of the world’s biggest trade publishing group, which sets standards with its creative diversity, global marketing power, and commercial strength. We will continue to expand Penguin Random House in the coming years, through organic growth and acquisitions. The book business is part of Bertelsmann’s identity. For us and our shareholders, the transaction is commercially attractive, as the share of Bertelsmann’s shareholders in group profit will increase by more than 70 million Euros per year.”
He continued: “With the publication of Michelle Obama’s memoir Becoming, which was simultaneously published in 45 languages just over a year ago, Penguin Random House impressively demonstrated its international capabilities and reach as a partner for authors. We are very proud that this important business will now be wholly owned by Bertelsmann. I would like to thank our co-shareholder Pearson for their excellent collaboration at all levels over the past years.”
Markus Dohle, CEO of Penguin Random House and a member of the Bertelsmann Executive Board, emphasized: “The full acquisition of Penguin Random House is a testament to Bertelsmann’s belief in the future of books and reading, as well as their trust in our colleagues around the world to be able to grow our company over the next several years. We are extremely well positioned to continue to take advantage of both organic and acquisitive growth opportunities in existing and new markets globally.”
Ownership of the Big Five global publishing groups now looks like this: Penguin Random House – Bertelsmann, Germany; Macmillan – Holtzbrinck, Germany; Hachette – France; HarperCollins – New Corporation, USA; Simon & Schuster – ViacomCBS, USA.