Bertelsmann at a Glance

Bertelsmann at a Glance

Description of the Business

Bertelsmann operates in the core business fields of media, services and education in around 50 countries worldwide. The geographic core markets are Western Europe – in particular, Germany, France and the United Kingdom – and the United States. In addition, Bertelsmann is strengthening its involvement in growth markets such as Brazil, India and China. The Bertelsmann divisions are RTL Group (television), Penguin Random House (books), Gruner + Jahr (magazines), BMG (music), Arvato (services), Bertelsmann Printing Group (printing), Bertelsmann Education Group (education) and Bertelsmann Investments (funds).

Organizational Structure

Bertelsmann SE & Co. KGaA is a capital market-oriented but unlisted partnership limited by shares. As a Group holding company, it exercises central corporate functions. Its internal corporate management and reporting follow the Group’s organizational structure, which consists of the operating divisions plus Corporate Investments and the Corporate Center.

Strategy

Bertelsmann’s strategic focus is on a strongly-growing and highly-profitable digital, international and diversified Group portfolio. Businesses in which Bertelsmann invests should have long-term stable growth, global reach, sustainable business models, high market-entry barriers and scalability. The education business is being developed into the third earnings pillar alongside the media and service businesses. During the financial year 2020, the Group strategy was further developed and focused on five strategic growth priorities. Under the motto “Bertelsmann_next,” the focus in the future will be placed on creating national media champions, expanding global content and service businesses, as well as expanding online education and the investment portfolio. In the financial year 2020, substantial strategic progress was made.

National Media Champions

RTL Group expanded its streaming offerings and significantly increased the number of subscribers. Mediengruppe RTL Deutschland extended its partnership with Deutsche Telekom in the areas of technology, marketing and content. It also strengthened the emerging fields of advertising technology and addressable TV. RTL Group fully acquired RTL Belgium and sold its stake in Broadband TV. In 2021, RTL Group announced the sale of the ad tech subsidiary SpotX and the full acquisition of Super RTL. Since the beginning of this financial year, Mediengruppe RTL Deutschland and Gruner + Jahr have been looking into expanding their collaboration. In December, Gruner + Jahr announced the signing of a put option to sale its French subsidiary Prisma Media.

Global Content

After Bertelsmann had completed its full acquisition of Penguin Random House in April 2020, in November, the Group announced its acquisition of the Simon & Schuster publishing group. Bertelsmann is optimistic to receive all approvals required from the competition authorities later this year. Penguin Random House delivered a strong publishing and business performance, especially in connection with the great worldwide success of Barack Obama’s “A Promised Land,” another global bestseller, after Michelle Obama’s memoir “Becoming.” The international production company Fremantle continued the expansion of its scripted formats, in some cases, selling top series such as “La Jauría,” “We Are Who We Are,” and “Enslaved” to more than 130 countries in some cases. The music subsidiary BMG benefited from the continued boom in streaming and numerous releases in its Recorded and Publishing businesses. Highlights included the expansion of the cooperation with the Rolling Stones.

Global Services

The services division Arvato saw strong growth overall. Arvato Supply Chain Solutions (SCS) grew with its customers in the consumer products, healthcare, IT, and tech industries. Arvato SCS expanded several international logistics centers. In June 2020, the international information services provider Experian acquired a majority stake in the Arvato Financial Solutions (AFS) Risk Management division with a view to strengthening their joint market position. AFS’s Collection Germany division will operate under the Paigo brand from now on, with a consumer portal of the same name. The CRM company Majorel achieved double-digit growth in its second fiscal year, fueled by global customers. Bertelsmann Printing Group (BPG) acquired two sites in the U.S.

Online Education Businesses

Bertelsmann Education Group served the continued high demand for online education and training. Relias invested in new products and technologies. Together with Udacity, Bertelsmann continued its successful three-year #50000Chances campaign. Some 60,600 individuals from 188 countries applied for one of the 15,000 scholarships in the second round of the “Udacity Technology Scholarship Program,” 25 percent more than in 2019. In total, 50,000 scholarships are being given away over a three-year period.

Global Digital Investments

Bertelsmann continued to expand its global digital investments to around 260 holdings, including 15 “unicorns.”