By Porter Anderson, Editor-in-Chief | @Porter_Anderson
Quarto To See Boost in Children’s Revenues
In an announcement today (August 8) ahead of its half-year report, London-based Quarto Group has announced that its wholly-owned subsidiary Quarto Publishing Group USA has bought the publishing assets of Becker & Mayer (logo spelling becker&mayer!) from the McEvoy Group.
The assets of Becker & Mayer’s book-publishing group as well as it’s SmartLap book-plus and toy business are to anchor Quarto’s fifth “creative hub,” as the company puts it, in the States, in Bellevue, Washington. The previous four centers of operation are in Minneapolis, the North Shore of Boston, Southern California, and New York City.
Quarto chief Marcus E. Leaver is quoted in a prepared statement saying: “”We have a close working relationship with becker&mayer! and we admire their people, creativity and specialist knowledge. We approached them because we have long felt that they would make a good cultural and strategic fit. We are delighted that McEvoy has agreed to sell the business to us as it will be a new and exciting addition to Quarto’s portfolio in the USA. We will leverage its unique publishing assets across the world through our global operational, sales and marketing platform, enhancing value for shareholders within the first full year.”
McEvoy Group President Jack Jensen says: “becker&mayer! has been a cherished McEvoy Group asset over the past 11 years. As we looked to the future, we became convinced that the extensive customer base and global market reach of The Quarto Group was perfectly positioned to help becker&mayer reach the next level of growth. We are pleased that the accomplished becker&mayer team will be an important part of The Quarto Group’s future.”
As Sarah Weinman at Publishers Lunch writes, the initial price of the buy is $9.8 million, but “the acquisition price may increase due to a working capital adjustment payment capped at $1 million and further deferred contingent consideration of up to $1.25 million, dependent on the performance of Becker & Mayer’s SmartLabs toy division business in 2018 and 2019.”
In its rationale statement for the acquisition, Quarto’s information for the media says that some 50 percent of Becker & Mayer’s activity is in children’s publishing. That “increases Quarto’s children’s publishing revenues by close to 30 percent,” Quarto’s news release announces.
In addition, Quarto reports that the acquisition should see its US interests overall account for some 45 percent of total group revenues.
“The transaction,” according to the statement, “is being financed out of the group’s existing $90 million multi-currency debt facility and is expected to be earnings-enhancing in the first full year of ownership.”