Bloomsbury announced a series of actions to raise capital and reduce expenses, preparing for a “prudent downside scenario” projecting the impact of the pandemic, which assumes “a 75% decline in print revenues and gradual retailer re-openings, to recovery in January 2021.” The company will raise approximately £8.4 million in cash by selling an additional 3.77 million shares (or 5 percent of the existing issued share capital) to “provide financial flexibility to the Company to enable it to maintain appropriate investment to capitalise on future commercial opportunities, whilst ensuring it remains within its banking covenants.” They note that, “Should a prolonged […]
Finance
Status: News Corp Warns On Virus Impact, Indigo Rehires Some Employees with Government Support
News Corp joined other public companies in issuing a formal notice to investors that the COVID-19 pandemic “is expected to adversely affect the Company’s business and results of operations,” detailing the negative impact across its businesses. At HarperCollins, “Sales are expected to be adversely affected by shipping restrictions and delays imposed by online retailers, as well as closures of brick-and-mortar retail stores.” Those declines are mitigated in part by “an increase in sales of digital formats of its titles.” The company advises that it is “implementing cost-savings initiatives company-wide,” without providing any further details on pay cuts, furloughs or other […]
LSC Reported to be Shopping Bankruptcy Financing, As Some Workers Have Virus
As we have reported previously, LSC Communications is expected to file for bankruptcy protection shortly. (According to Bloomberg, they have been working with bankers at Evercore and attorneys at Sullivan & Cromwell.) In the latest indication, earlier this week the WSJ reported on tightening terms in the debtor-in-possession financing market, as lawyers and advisers “say they expect a deluge of debt restructurings and chapter 11 filings due to the massive disruption caused by the novel coronavirus.” DIP financing usually comes with lots of protection and collateral for the lenders, but these uncertain times are “turning what looked like sure bets […]
Status: More on Macmillan’s Layoffs, Barnes & Noble Redesigns Stores, WH Smith Will Sell More Shares
Further to the 5 reported layoffs at St. Martin’s (primarily from Thomas Dunne Books), last week’s companywide job cuts at Macmillan also saw the elimination of 5 positions at Farrar, Straus, including executive editor Colin Dickerman, svp, director of special projects Jeff Seroy, and vp, sales and marketing, Picador Darin Keesler. Another 3 positions were eliminated at Holt, including executive editor Paul Golob and senior editor Jonathan Cox. Subsequent disclosures also included Diana Gill, Melissa Frain, Diana Pho and Alison Bunis at Tor. Given that a spokesperson said last week, “We are doing layoffs across the organization,” that suggests that […]
Bertelsmann Completes Acquisition of Pearson’s Final 25% Stake In Penguin Random House
As of April 1, Bertelsmann finalized their purchase of Pearson’s remaining 25 percent share of the Penguin Random House joint venture, for $675 million. (As a reminder, the enterprise value of that minority stake, including PRH’s debt, is $917.5 million.) Having paused a share buyback program that aimed to return some of that money to shareholders after spending £167 million, Pearson now says it “will retain the proceeds from the disposal…to further strengthen our short-term financial position” during the current crisis. Pearson previously held two seats on the PRH board, which are likely to be placed or retired. For now, […]
HarperCollins to Acquire Egmont Books UK, Egmont’s Book Business in Poland, and Schneiderbuch Germany
HarperCollins will acquire Egmont Books UK, as well as Egmont’s book business in Poland and Schneiderbuch in Germany, in a deal that is set to close on April 30. (Those units are run out of Egmont Publishing, which also operates the company’s magazines, rather than the Egmont Books division, which focuses on Cappelen Damm in Norway and Lindhardt & Ringhof in Denmark.) (May 1, 2020 update: Harper UK has completed the acquisition, for an undisclosed sum.) Egmont Books UK will operate as a standalone children’s division, and will remain in its offices for now. Egmont UK managing director Cally Poplak […]