Publishers might soon change hands

August 10, 2006

Reuters is reporting that several prominent publishers, currently tethered to larger companies and media conglomerates, could be the target of bids from private equity firms looking for the steady cashflow that their backlists would provide. At the top of the list is Penguin, currently owned by Pearson, but News Corp’s HarperCollins and CBS’s Simon & Schuster could be separated from their parents as well. So far Houghton Mifflin is the only major publisher to have been extracted from its parent (Vivendi in this case) by private equity firms.

Is this good news for publishers? Since they’re not very profitable, publishers are often forgotten alongside the other holdings of these large media companies. At the same time, however, private equity firms’ primary motive would likely be getting a return on their investment, so cost cutting could probably be expected.

created The Millions and is its publisher. He and his family live in New Jersey.

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