German media giant buys Random House

AFTER signalling for months that it was preparing to bolster its position in book publishing, the Germany-based Bertelsmann group yesterday showed its cards by announcing the purchase of Random House in New York.

Bertelsmann said it was buying Random House and all of its imprints, which include Knopf and Ballantine, which will be folded into its existing publisher, Bantam Doubleday Bell. Bertelsmann bought Doubleday and its Dell imprint in 1986.

It declined to reveal the price, disclosed no financial details of the deal and said the new company would not be listed on the stock exchange.

The new entity will use the Random House name and will be headed by Albert Vitale, the current chairman of Random House. Until four months ago, when he resigned in a blitz of publicity, the president of Random House was Britain's Harold Evans. He was replaced by Ann Godoff.

The transaction could spell a new period of consolidation in the book publishing industry. In the US especially, publishers have suffered recently from declining sales and the increasing squeeze on book-cover prices exerted by the newly-emergent book super-chains, such as Barnes & Noble.

It had been speculated that Bertelsmann had its eyes alternatively either on HarperCollins, the book unit of Rupert Murdoch's News Corp, which was recently at the centre of the Chris Patten affair, or Simon & Schuster, which is owned by Viacom.

Even before yesterday, Bertelsmann was the world's third-largest media conglomerate after Disney and Time Warner. Random House, founded in 1926 and owned by Advance Publications, is America's largest general trade publisher. Its big-name authors include Norman Mailer, Michael Crichton and the Pope.

The deal was being seen as boost to Bertelsmann's BooksOnline venture, which it launched last month in direct competition with the two American online bookselling websites from and Barnes & Noble. Random House will give BooksOnline a fat new inventory of titles.

Headed by the 70-year-old SI Newhouse, Advance is expected to use the sale of Random House to reinforce its major magazine, newspaper and cable television interests. The privately held company is best-known as the owner of Conde Nast magazines, publisher of Vanity Fair and GQ, as well as the New Yorker, which is edited by Mr Evans' wife, Tina Brown.

The fortunes of Conde Nast, headed by Steve Florio, are believed to have improved after a plunge into the red in the early 1990's. Some observers estimate that profits at the group are at about $100m (pounds 61m) on revenues of $900m. While advertising and circulation at the New Yorker have both seen improvements under Ms Brown, the magazine is thought still to be losing money.

"Random House is the most prominent and prestigious publishing house in the world," Mr Newhouse said yesterday. "I am confident that it will grow and prosper under Bertelsmann's future leadership".

Mark Woessner, the chairman of Bertelsmann, said that annual sales of the new publishing unit would be $1.4bn to $1.6bn. "Ever since we bought the US publisher Bantam Books in 1977 it was a strategic goal with the highest priority to strengthen the core book business," he said.

Bertelsmann is the owner of a glitzy new office tower on New York's newly- desirable Times Square, which has a Richard Branson Virgin Megastore as one of its tenants on street level. The company's activities include huge printing operations, book publishing and over 16 million book club members, music recording and publishing, the CLT-Ufa television broadcasting group and an Internet alliance with America Online.

Despite the company's push since the 1980s into television and online media, Mr Woessner has often stressed that the company would never depart from its publishing roots, formed in 1835 when Carl Bertelsmann began publishing Lutheran bibles.

Start your day with The Independent, sign up for daily news emails
Arts and Entertainment
Joel Edgerton, John Turturro and Christian Bale in Exodus: Gods and Kings
Arts and Entertainment
Brendan O'Carroll as Agnes Brown in the 2014 Mrs Brown's Boys Christmas special
tvCould Mrs Brown's Boys have taken lead for second year?
Members and supporters of the lesbian, gay, bisexual, transgender (LGBT) community walk with a rainbow flag during a rally in July
footballLive! Chelsea vs West Ham kicked off 10 Boxing Day matches, with Arsenal vs QPR closing the action
ebooksA year of political gossip, levity and intrigue from the sharpest pen in Westminster
Arts and Entertainment
Amy Adams and Christoph Waltz in Tim Burton's Big Eyes
film reviewThis is Tim Burton’s most intimate and subtle film for a decade
Arts and Entertainment
Jack O'Connell stars as Louis Zamperini in Angelina Jolie's Unbroken
film review... even if Jack O'Connell is excellent
Arts and Entertainment
Madonna is not in Twitter's good books after describing her album leak as 'artistic rape and terrorism'
music14 more 'Rebel Heart' tracks leaked including Pharrell Williams collaboration
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Selby Jennings: Oil Operations

Highly Competitive: Selby Jennings: Our client, a leading European Oil trading...

The Jenrick Group: Night Shift Operations Manager

£43500 per annum + pension + holidays: The Jenrick Group: Night Shift Operatio...

SThree: Trainee Recruitment Consultant - LONDON

£20000 - £25000 per annum + OTE £40,000 + Car + Pension: SThree: SThree are a ...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £35K: SThree: We consistently strive to be the...

Day In a Page

A Christmas without hope: Fears grow in Gaza that the conflict with Israel will soon reignite

Christmas without hope

Gaza fears grow that conflict with Israel will soon reignite
After 150 years, you can finally visit the grisliest museum in the country

The 'Black Museum'

After 150 years, you can finally visit Britain's grisliest museum
No ho-ho-hos with Nick Frost's badass Santa

No ho-ho-hos with Nick Frost's badass Santa

Doctor Who Christmas Special TV review
Chilly Christmas: Swimmers take festive dip for charity

Chilly Christmas

Swimmers dive into freezing British waters for charity
Veterans' hostel 'overwhelmed by kindness' for festive dinner

Homeless Veterans appeal

In 2010, Sgt Gary Jamieson stepped on an IED in Afghanistan and lost his legs and an arm. He reveals what, and who, helped him to make a remarkable recovery
Isis in Iraq: Yazidi girls killing themselves to escape rape and imprisonment by militants

'Jilan killed herself in the bathroom. She cut her wrists and hanged herself'

Yazidi girls killing themselves to escape rape and imprisonment
Ed Balls interview: 'If I think about the deficit when I'm playing the piano, it all goes wrong'

Ed Balls interview

'If I think about the deficit when I'm playing the piano, it all goes wrong'
He's behind you, dude!

US stars in UK panto

From David Hasselhoff to Jerry Hall
Grace Dent's Christmas Quiz: What are you – a festive curmudgeon or top of the tree?

Grace Dent's Christmas Quiz

What are you – a festive curmudgeon or top of the tree?
Nasa planning to build cloud cities in airships above Venus

Nasa planning to build cloud cities in airships above Venus

Planet’s surface is inhospitable to humans but 30 miles above it is almost perfect
Surrounded by high-rise flats is a little house filled with Lebanon’s history - clocks, rifles, frogmen’s uniforms and colonial helmets

Clocks, rifles, swords, frogmen’s uniforms

Surrounded by high-rise flats is a little house filled with Lebanon’s history
Return to Gaza: Four months on, the wounds left by Israel's bombardment have not yet healed

Four months after the bombardment, Gaza’s wounds are yet to heal

Kim Sengupta is reunited with a man whose plight mirrors the suffering of the Palestinian people
Gastric surgery: Is it really the answer to the UK's obesity epidemic?

Is gastric surgery really the answer to the UK's obesity epidemic?

Critics argue that it’s crazy to operate on healthy people just to stop them eating
Homeless Veterans appeal: Christmas charity auction Part 2 - now LIVE

Homeless Veterans appeal: Christmas charity auction

Bid on original art, or trips of a lifetime to Africa or the 'Corrie' set, and help Homeless Veterans
Pantomime rings the changes to welcome autistic theatre-goers

Autism-friendly theatre

Pantomime leads the pack in quest to welcome all