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Editis rises again to face future

14.03.08 Barbara Casassus

French publisher Editis must feel like a phoenix: once part of the defunct Vivendi empire, under new parent the investment group Wendel, the publisher of Khaled Hosseni and Harlan Coben in France has risen again to the point where it is talked about as an attractive takeover target.

Editis began life in 2003, after Hachette rescued it from the Vivendi ashes, only for the European Commission to order Hachette—France's largest publisher—to offload 60% of the business it had bought.

The 60%—Editis—was left with a €150m (£114m) hole, as well as no parent company—Wendel did not buy it for another nine months. It did, however, retain its c.e.o. the softly-spoken Alain Kouck who, four years later, is on a positive footing.  "We must have broken the world record for rumours in the publishing business," he says. "Our credo is business first, which is our best guarantee for the future." And business has been good at France's second biggest publisher with €160m (£122m) spent on acquisitions and revenue growth of 60%.

Entering the Editis fold were French publishers Le Cherche Midi, First, XO with its subsidiary Oh!, Grund, e-learning specialist Paraschool, Belgium's French and Dutch language house de Boeck,  and French supermarket -distributor DNL.

Kouck's approach to integration has been federal. All the houses are still headed by their owners or founders, who continue to work in an entrepreneurial spirit, while taking advantage of economies of scale in marketing, sales, logistics and manufacturing.Figures to be published on 26th March will show double-digit growth in operating profit for 2007, with turnover up to €760m (£580m). "Seven acquisitions in four years have improved profitability and, in turnover terms, have offset the departure of Larousse from [distributor] Interforum in January 2006 and of Hachette's education houses last January," Kouck says.

Yet Editis lost out to Pearson in the takeover of Italian educational publisher Paravia and withdrew in its bid for the education division of Dutch house Wolters Kluwer, which means it has not yet met the Wendel turnover target of €1bn (£760m). "We have no regrets about Wolters Kluwer," Kouck says. "It was too expensive and we have no intention of compromising our future for an acquisition."

Kouck is focusing on three other strategies for the future. The first is to develop expertise and know-how with partners abroad to create economies of scale—it is pooling resources with HarperCollins on digital strategy and equipment, and is in discussion with two publishers to negotiate printing contracts jointly. The second strategy is to achieve group optimisation, which includes pairing off several houses to encourage editorial synergies and economies of scale. The third priority is to develop e-commerce. Its digital business has increased 25% a year over the past few years and now accounts for 5% of Editis' book sales.

That does not mean bookshops and other retail outlets are no longer important for Editis. "On the contrary, it is vital for France to maintain its network of retailers, of whom 14,000 distribute Editis books," he says. "They are an indispensable weapon in combatting piracy. After all, who is going to spend a night downloading a book when they can buy a paperback around the corner?"

Apart from strengthening its position on the domestic market and its influence throughout the French-speaking world, the priorities for external expansion are "Europe and education", Kouck says.

So, an attractive takeover target? Rumours suggest that Wendel wants to shed its publishing venture before the end of June, with Spanish publisher Planeta said to be keen. But Kouck appears unflustered. Looking back on two years of upheaval in 2003 and 2004, Kouck says he does not really have bad memories but "it was an experience we could have done without—I wouldn't wish it on my enemies," he adds.

International Interview Trade Barbara Casassus France Editis Planeta Hachettte

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