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Bertelsmann splits book club business

04.09.07 Philip Jones

Bertelsmann is to reorganise its book club division Direct Group by splitting it in two -- one comprising Europe and Asia while another would handle the North American business. The move comes as first half results published by Bertelsmann showed that the business turned in a loss €35m in the first six months of the year.

Fernando Carro was named as c.e.o. of Direct Group, which will handle the operations in Europe and Asia, including the UK's Book Club Associates (BCA). Carro will report to Bertelsmann chairman and c.e.o Gunter Thielen.

Direct Group North America will operate under the name of Bertelsmann Direct North America and will continue to have Stuart Goldfarb as its president and c.e.o. Goldfarb will report to Peter Olson, Bertelsmann management board member as well as chairman and c.e.o. of Random House.

The Direct Group posted revenues of €1.2bn, and made an operating loss of €35m in the six months to end-June 2007. The company said: "In comparison to the previous year, the normal seasonal variation is intensified by the publication of high selling CDs and DVDs in the second half of the year. The generally declining CD market of the American music club business impacted negatively. There were also costs for the move of the English book club from London to Swindon."

Philip Jones Bertelsmann BCA Book Clubs

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