Penguin Is Buying MCA's Putnam Berkley for $336 Million (original) (raw)
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THE MEDIA BUSINESS
- Nov. 27, 1996
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November 27, 1996
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Section D, Page
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In a move meant to combine old-style literary sensibilities with commercial publishing acumen, the Penguin Group, the international publisher, plans to acquire the Putnam Berkley Group, a United States subsidiary of MCA Inc., for $336 million in cash in a deal announced today by Penguin's owner, Pearson P.L.C.
The acquisition, which the company said would create a felicitous marriage between Penguin's strong backlist of steadily selling books and Putnam's formidable front list of best sellers, would result in a powerful force in United States publishing. The combined company, which will be run by Phyllis Grann, currently chairwoman and chief executive of Putnam, would represent about 12 percent of total book sales in the country, Pearson said.
''One can see that putting the two businesses together makes a good deal of strategic sense, particularly in relation to respective profits from backlist and front list,'' Robert Jollisse, a media analyst for ABN Amro Hoare Govett here, said.
Because Penguin has a vast worldwide network, and Putnam is exclusively American, ''applying the leverage of Penguin's international distribution and sales network should enable Berkley to accelerate revenue growth,'' Mr. Jollisse said. ''The two provide a good natural fit,'' he added.
Although its list includes some notable best-selling authors, most prominently Stephen King, Terry McMillan, and, recently, Mary Karr, Penguin is better known for its rich backlist, which includes such heavy-hitting literary figures as Arthur Miller, Gabriel Garcia Marquez, Roald Dahl, Toni Morrison, Bruce Chatwin, E. L. Doctorow, Joyce Carol Oates and Nadine Gordimer. Such names are important for publishing companies, because, in addition to prestige, they guarantee strong, steady sales year after year.
Under Mrs. Grann, Putnam has become known for its ability to turn out books that rise to the top of best-seller lists almost as soon as they are published. Among the company's perennially best-selling authors are Tom Clancy, Dick Francis, Patricia Cornwell and Amy Tan.
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