Bertelsmann increases stake in Penguin Random House
July 12, 2017
German media giant Bertelsmann has agreed to acquire a further 22% share in Penguin Random House (PRH) from British co-owner Pearson for about $1 billion, increasing its stake to 75%. The transaction values the publisher at $3.55 billion.
The deal will allow Pearson to return £300 million to shareholders and represents a continuation of the company's shift away from traditional publishing and towards the digital education business. Pearson's other recent disposals include the 2015 sale of the Financial Times for £844 million and the divestiture of a 50% stake in The Economist Group for a reported £469 million in 2015. The company's stock dipped more than 5% in the wake of the sale of its PRH stake.
The PRH joint venture was formed in 2013 by combining Pearson’s Penguin Books and Bertelsmann’s Random House, creating one of the five largest book publishers in the world, according to Publishers Weekly, with annual revenues exceeding $4 billion.