To continue the extensive baseball metaphors, the DOJ v. PRH antitrust trial enters its home stretch this week, with parties scheduled to deliver closing arguments on Friday. We’ve written well over 20,000 words about the trial since the proceedings started (and that does not count any of the court transcripts we have attached for further reading). To follow the arguments from the start, here are the notable takeaways so far, day by day, along with links to the full pieces. (NB, we have reserved our extensive coverage for PublishersMarketplace.com members. For the trial-obsessed among readers of our shorter, free Publishers […]
Antitrust Trial
Berkett Details the S&S Bidders
Most of ViacomCBS executive Alex Berkett’s testimony on Monday morning was in closed session. But he confirmed for the record that the final three bidders for Simon & Schuster were PRH, Vivendi and HarperCollins. The other invited bidders in the first round were “another strategic buyer” (e.g. a company in publishing), and a financial buyer, identified as based on “relationships that we had with certain human beings at one of the private equity firms and their background in the publishing business.” (This means, presumably, Richard Sarnoff at KKR). And “there was a very small strategic buyer that had a financial […]
Sansigre on Real Estate Efficiencies, Silk, and The Op Ex Matrix
Yesterday PRH svp of M&A Manuel Sansigre, who has reviewed 100 possible acquisitions at PRH and closed 26, testified on the details of developing PRH’s bid and “efficiencies model” for S&S. His testimony resumed Tuesday morning. When Viacom announced the sale of S&S in March 2020, Sansigre’s team began creating an efficiency model—analyzing duplications between the two companies—(and continued even when the sale was on pause through the spring and summer due to COVID) with publicly available info about S&S. Around Labor Day 2020, Viacom restarted the sale process and gave Sansigre access to raw S&S data—“P&Ls by country, by […]
McIntosh Speaks Broadly About Publishing; Approves About 200 Seven-Figure Deals A Year
PRH US ceo Madeline McIntosh testified for a good portion of Monday in the DOJ antitrust trial, spending much of her time on a level-headed explanation of many of the financial, strategic and procedural nuts and bolts of publishing. There were a lot of numbers, but one number stood as representing just how big PRH already is as a company. McIntosh approves all advances at the company of $1 million or more, and annually, “on average, I directly approve about 200” such deals. So of the approximately $1 billion market the government says ATSB represent — and the roughly $370 […]
Agents on the Merger
The antitrust trial’s afternoon session continued with three literary agents taking the stand for the defense—Elyse Cheney, Andrew Wylie, and Gail Ross. They discussed auctions and negotiations, how they retain their power, and the effect of the possible merger on their clients. Cheney echoed what many other witnesses have said when asked why Big 5 publishers acquire books for $250,000+ more often than non-Big 5 do. “I think the non-Big 5, you know, are just not going to play in that sandbox too many times. They don’t have the same scale.” But when they do acquire ATSB, smaller publishers have […]
A3 Thursday: Charles Duhigg’s Atypical Testimony, and More
Author of The Power of Habit Charles Duhigg served as a curious and somewhat baffling witness for the defense on Thursday. The upshot is, he is a very happy Random House author, and he has made so much money he really doesn’t care about his advances. Also, despite having an MBA and having written about economics, he does not appear to understand the nuts and bolts of business very well. Duhigg has had a rewarding and valued partnership with his editor, Andy Ward. On the process of writing The Power of Habit, Duhigg said, “It would not be unfair to […]