The Murdochs and the Bancrofts

Looks like there has been a change of heart in the Bancroft family and the sale of the company looks all but inevitable. Reuters

From the article:

The Bancroft family, which controls 64 percent of Dow Jones's voting power, said it would also look at offers from other bidders. Dow Jones in a separate statement said the board would consider News Corp.'s offer and other approaches.

The Bancroft decision is a change from its earlier rejection of Murdoch's $60-a-share bid, and brings the publisher of The Wall Street Journal closer to being sold after more than a century of being independent.

Obviously, assuming Murdoch gets this prize it would be unlikely that he will have a go at Pearson. Clearly the market sees this as a real event and the stock was up sharply on the news to slightly below the Murdoch offer level.

Book Expo - Quotes

Shatzkin - End of General Trade: "Print will be the last media to be read on a device....and we shouldn't be proud of that." With respect to published content, "all obsessions no matter what it is will be indulged" and brands as a result "move to a very granular level"

Gomez (Print is Dead): "there will be no e-book revolution until we come up with another name for it" which reflects the interactive nature of the product. And there will be "integration not another IPod". We need to "thinkof the children" who are and will be consumers of our content.

Hyatt - Social Networking for Publishers - It is important "to be authentic" in communications because users will see through what you are doing. Resist the temptation to have someone "ghost write your blog" because you will be found out.

BookExpo Panel Meeting

Reminder to readers: The panel I am hosting at BEA is at 2:30 this afternoon in Room 1E04. On the panel are executives from Overlook Press, Harlequin, HarperCollins, Berkshire Publishing and Thomas Nelson. See you there.

Comedy Central's News Babes

I have a view on network news programs but I wish I were this funny.

Reed Elsevier Most Obvious Buy-Out Candidate?

The Times is reporting that Deutsche Bank called Reed Elsevier the publishing sector’s “most obvious buyout target”. The bank has raised its recommendation on the stock to buy. This is how they see it:

The broker argued that Reed shares could be worth up to 780p to a financial buyer. Sums involved in the Thomson Learning deal also suggested that Reed’s sale of its education business could raise £2.2 billion, up from its previous forecast of £1.8 billion, it said. Reed finished up 16p at 675½p.

Certainly the rules have changed somewhat but applying the multiple paid for Thomson Learning to all of Reed is not quite appropriate. Other analysts have suggested that Reed will escape their education foray successfully and the share price for the balance of Reed will escalate because it is currently weighted down by the educational unit. Reed will certainly benefit from the Thomson Learning sale but if you look at the multiple paid for Reuters (an information business) by Thomson the picture is not as glaringly bright if you are concerned with relative price multiples. Either that or Thomson got a real bargain.

DB may have a vested interest here because Pearson has been consistently touted as the most likely PE target. No doubt there is more action to come in this arena.

Publishing News - An Explanation

When I was at PriceWaterhouse (1995-99), I thought of using this new fangled Internet thing to seek news and information about the publishing industry that I could then summarize in an email and distribute it to my colleagues and the Partners at PW. (No Google then). Our business unit was established to build consulting relationships with major publishing and information companies and I believed that my email news letter (Publishing News) would be useful to the team in understanding the publishing landscape and the key people in the industry.

I kept all of these emails and decided to add them to this blog as supplementary information for some of my readers who from time to time may need background information on certain publishing companies. Regrettably, when I joined Bowker I didn't have the time to keep this up and there is a rather large gap between the end of Publishing News and the start of this blog. It is what it is.

Publishing News 1997-8
Publishing News 1999

Borders Reports First Quarter

Borders reported their first quarter results with little change to show for the new strategy that they are in the process of executing. Overall revenue up versus the same period last year however, same store sales were lower with books revenues slightly worse than last year, DVDs flat and music lower. PaperChase - the stationary misfit - continued to perform better than forecast. The company opened four new superstores during the period which contributed to the overall revenue increase.

There was little news on the new strategy other than to say the company is proceeding with the sale of the international stores where revenues were slightly better than the same period last year.

Readers may recall the aborted debt refinancing the company attempted earlier this year and in the press release the company noted that they expect to seek between $150 - $200million in term loan financing sometime during the second quarter. Perhaps the second time they will explain how this refinancing will benefit shareholders.