Penguin Random House Sells Its Australian Online Bookstore to Larger Rival
The prevailing wisdom may be that publishers need to have more and better connections to consumers, but apparently that doesn’t apply in Australia.
Smart Company, Sydney Morning Herald, and other sources reporting that PRH Australia has sold its online bookstore Bookworld to Booktopia. The terms of the deal have not been disclosed, but Smart Company did note that Booktopia CEO Tony Nash said that this deal will give Booktopia an 80% share of the local online book sales, up from the 62% he says Booktopia already holds (*).
Booktopia generated $54 million in revenue in the 2014-15 financial year, but Nash expects that "with this acquisition and continued growth, in the coming financial year it will hit $90 million". Nash plans to keep the brands separate but will be combining operations t reduce cost and improve service.
Neither site is well-known north of the Tropic of Cancer, but I see from my notes that Booktopia was at one time a local partner for the Google eBookstore (back when Google was still doing that kind of thing).
And Bookworld, as you may recall, was formed out of the online assets of the former Borders Australia and Angus & Robertson websites when their parent company, RedGroup Retail, went bankrupt in early 2011. Bookworld launched in 2012 after Penguin "paid less than $5 million for the assets of Borders and A&R". In addition to the assets, Penguin also picked up the local Kobo partnership.
This is a smart move by Penguin for the simple fact that Australia is perhaps the one English-speaking country in the world where you do not want to be a local book retailer. Their local book prices are so ridiculously high that the UK-based Book Depository is a leading bookseller in the Australian market.