Pearson has disclosed that they are in the midst of selling their 22% stake in Penguin Random House to Bertelsmann. When this $3.55 billion dollar deal is completed, Bertelsmann will own 75% of the publishing company that is responsible for 3/4 of all books printed per year.
Thomas Rabe, Chairman and CEO of Bertelsmann, said: “Penguin Random House is a success story. We completed the integration in a very short time, and today the group is the clear worldwide number one in book publishing. We are especially pleased about this because the book business has been part of Bertelsmann’s identity for over 180 years. Beyond this, the transaction is an attractive proposition economically, as the earnings attributable to Bertelsmann shareholders will increase by more than 60 million euros.”
Pearson intends to focus on their own digital textbook business and use over a billion dollars in modernizing. The textbook publisher needs to do something quick, their overall sales declined 8% in 2016 and they are expected to not turn it around anytime soon.