When Pearson agreed to buy education and CD-Rom publisher Dorling Kindersley on Friday for $495 million, the international media group sent a signal that it believes DK’s troubles are behind it.
DK grabbed headlines in January after selling just 3 million of the 13 million “Star Wars” books it printed last fall, resulting in a $40 million operating loss in the second half of 1999. DK CEO James Middlehurst promptly resigned, leaving founder and chairman Peter Kindersley as the de facto company director.
But DK, one of the last major independent houses on either side of the Atlantic, brings a diverse range of books and franchises to Pearson. DK has licenses with the NFL, Major League Baseball, Barbie and Lego. DK books are instantly recognizable for their unique visual style, which has been widely mimicked by other houses. Their reference and illustrated book list should mesh well with Penguin’s fiction and nonfiction program.
DK founder Peter Kindersley has said that he’s seeking better infrastructure and distribution in the deal. Pearson’s deep pockets should help DK maintain market share in a publishing industry dominated by massive, widely diversified entertainment companies.
In 1996, Pearson bought Putnam Berkley from Seagram Co. for $336 million, but that deal was dwarfed by Bertelsmann’s acquisition of Random House two years later in a deal valued at $1 billion.