Bertelsmann Sells BertelsmannSpringer To Cinven And Candover

Bertelsmann is selling the specialist publishing group BertelsmannSpringer to the private equity firms Cinven and Candover. Bertelsmann, Cinven and Candover signed a contract to this effect on Monday. The debt free purchase price is EURO 1.05 bn. Through this transaction, Candover and Cinven are acquiring one of the world's most prestigious publishing groups for scientific and academic literature. The 70 companies that comprise BertelsmannSpringer publish 700 magazines and more than 4,000 new book releases in the fields of science, medicine, economics, engineering, architecture, construction and transport each year. In 2002, BertelsmannSpringer generated total revenues of EURO 731 million and Operating EBITA of EURO 71 million. The group has operations in 16 countries, with over 5,000 employees. The transaction is subject to antitrust approval. It remains to be decided whether Candover and Cinven will acquire BertelsmannSpringer's activities in France, which account for 4.5 percent of total revenues.

Bertelsmann Chairman & CEO Gunter Thielen commented: "The sale of BertelsmannSpringer is a logical continuation of our strategy of concentrating on core businesses. Although this is not an easy parting for us, we firmly believe that the sale is the right and necessary thing to do, both for the future of Bertelsmann and for the future of BertelsmannSpringer. In selling the group, we made every effort to preserve it as a whole. BertelsmannSpringer's employees and management deserve a great deal of recognition. Thanks to their achievements, BertelsmannSpringer commands an excellent international position, is profitable and is considered one of the best sources of scientific and academic literature."

Bertelsmann CFO Siegfried Luther declared: "This transaction enhances our financial flexibility and creates the preconditions for future growth in our key divisions. At the same time, we are sure that in Cinven and Candover we have found partners who will make the most of BertelsmannSpringer's potential while continuing to develop the business."

Bertelsmann's specialist publishing division was founded in 1953. In 1999, Bertelsmann took over the majority of the international science publisher Springer and merged it with Bertelsmann Specialist Publishing, creating the BertelsmannSpringer division. Today, BertelsmannSpringer includes publishing companies such as the Springer science publishing company, Birkhäuser, Ärzte Zeitung, Princeton Architectural, Key Curriculum, Platow, Gabler, Bauverlag, Heinrich Vogel as well as a number of online services and the electronic service SpringerLink. In 2002, BertelsmannSpringer contributed 3.9 percent of Bertelsmann's total revenues.

Cinven and Candover are two of Europe's leading private equity companies. Cinven was founded in 1977 and has carried out over EURO 40 billion in corporate acquisitions to date. Candover was founded in 1980. Its transactions to date have a total volume of more than EURO 22 billion. Candover has been traded on the London stock exchange since 1984. In January 2003, Candover and Cinven acquired the specialist information group Kluwer Academic Publishers from the Dutch information group Wolters Kluwer.

About Bertelsmann AG
Bertelsmann is a media and entertainment company that commands internationally leading positions in the relevant markets. Its core business is the creation of first-class media content: the group includes RTL Group, Europe's No.1 in the TV and radio business, as well as the world's biggest book-publishing group Random House, with its more than 100 publishers (e.g. Alfred A. Knopf, Bantam, Siedler Verlag, Goldmann). Europe's biggest magazine publisher Gruner Jahr (stern, GEO, Capital, Femme Actuelle, Family Circle, Parents) and the BMG music group with its roughly 200 labels (RCA, Arista, Jive, J Records) and artists including Alicia Keys, Dido and Pink, stand for creativity and powerful brands. DirectGroup bundles Bertelsmann's direct-to-customer business: book and music clubs with more than 40 million members worldwide. The media services provided by the arvato division include the rapidly growing arvato logistics services and arvato direct services units (which include distribution, service centers, and customer loyalty systems), as well as state-of-the-art printing plants, storage media production and comprehensive IT services.

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