Springer Group, Second-Leading STM Publisher, Sold by/to Private Equity Firms
Sale involves $146 million in cash and the transfer of $3.22 billion of debt.
Norman Oder -- Library Journal, 12/11/2009
| Go back to the Academic Newswire for more stories |
- Springer formed in 2003
- Debt was refinanced
- New owners expected to invest in company
- Digital strategy continues
The Berlin-based Springer Group, the world's second-largest STM publisher, has been sold, six years after it was formed by the purchase and merger of Bertelsmann Springer and Kluwer Academic by the British private equity firms Cinven and Candover.
The purchasers are EQT, a Swedish private equity fund, and GIC, a private fund backed by the Government of Singapore. EQT will own 82% and GIC 18%.
The Times of London put the sale at €2.3 billion ($3.36 billion), including €100 million ($146 million) in cash and the assumption of about €2.2 billion ($3.22 billion) of debt.
High return
The private equity firms paid about €1.6 billion for the two components of Springer. The Financial Times reported that the deal values Springer at about eight times earnings, as with rivals Informa and Reed Elsevier, and, considering the refinancings that increased the debt, gave the owners a 29 per cent annual return.
EQT and GIC have agreed to inject new equity into the Springer Group, to strengthen its balance sheet and decrease the overall cost of funding, Springer said in a statement. This deal is expected to conclude by early February 2010.
Growth potential
“Springer is perfectly positioned in a market where we see great growth potential. We believe that by working together with the company and the best-in-class management team under CEO Derk Haank we can drive both expansion and further development of the successful e-business,” said Marcus Brennecke, Senior Partner at EQT Partners, advisor to EQT V. “As the number 2 player in the STM sector, Springer is a great platform for further consolidation and market share growth."
(The leader is Elsevier, part of Reed Elsevier, also the parent company of Library Journal.)
Derk Haank, Springer’s CEO, said, “The Springer Executive Management Team has had constructive and collegial discussions with EQT. I am confident that this marks the beginning of a new exciting and successful chapter for us and for our new partners at EQT and GIC. The sale will allow us to move our ambitious and ongoing ‘e’ strategy forward, and to invest more heavily for our stakeholder’s benefit – this is the best solution for the company, our employees and shareholders.”
Springer publishes around 2000 journals and more than 6500 new books a year, and has the largest STM eBook Collection worldwide. Springer operates in about 20 countries in Europe, the United States, and Asia. It has more than 5000 employees. Last year, its annual sales were about €892 million.
Contact the author: noder@reedbusiness.com
Read more Newswire stories:
Library Groups Ask Justice Department To Supervise Institutional Pricing for Google Book Database
White House Signals Interest in Open Access with Public Call for Comments
UC San Diego, Museum of Contemporary Art, Form Partnership
Out of Google Deal, France Commits $1.1 Billion to Digitization
Inside Academic Building Projects for 2009
Columns:
Don't Panic! | Peer to Peer Review
Not Textbooks. Think Curricular Resource Strategy, Part II | From the Bell Tower
