Press Release | Gütersloh, 06/15/2011

Bertelsmann Reorganizes Direct Group’s Businesses

• Direct Group disbanded as stand-alone division
• Operations in Germany, Spain and Eastern Europe reassigned to Corporate Investments
• Review of strategic options for activities in Eastern Europe
• Fernando Carro takes on additional management roles within the Group

The international media company Bertelsmann is reorganizing Direct Group’s businesses. After the sale of its operations in France was completed in late May, Direct Group will be disbanded as a stand-alone division of Bertelsmann AG with effect from June 30, 2011. The Bertelsmann group will then consist of the four remaining divisions RTL Group, Random House, Gruner + Jahr and Arvato.

The club and direct-marketing businesses in the German-speaking countries, Spain and Eastern Europe will be managed under Corporate Investments, for which Thomas Rabe is responsible on the Bertelsmann Executive Board. Corporate Investments includes BMG’s music rights business, as well as the Bertelsmann Digital Media Investments (BDMI) and Bertelsmann Asia Investments (BAI) funds.

Strategic options, including a possible disposal, are being reviewed for the Eastern European book distribution business in Russia, Ukraine, the Czech Republic and Slovakia.

Fernando Carro, CEO of Direct Group, will continue to be responsible for Direct Group. He will also take on additional responsibilities in the Group, including in the development of growth opportunities in Central and South America, and Spain.

Hartmut Ostrowski, Chairman & CEO of Bertelsmann AG, said: “As part of our strategy to improve the growth profile of Bertelsmann, we have gradually sold off Direct Group’s international operations since 2008. We reached another milestone with the divestment of the businesses in France, after having sold a number of other businesses earlier. The decision to reorganize the remaining Club businesses completes the scale-back of Direct Group, and thus concludes a large strategic task.” 

Ostrowski added: “I would like to thank the management team led by Fernando Carro for their great sensitivity in managing this difficult process, which has been at times painful for the employees. I am very glad that Fernando Carro will be taking on additional tasks in the Group, in order to develop new growth opportunities for Bertelsmann.”

Fernando Carro, CEO of Direct Group, said: “This organizational change is the logical continuation of Bertelsmann´s strategic priorities. We have managed this very challenging process together as a team. I would particularly like to thank my Board colleagues and the staff of Direct Group, without whose support we would not have achieved this result. We have worked to find a good solution for each business and are striving to do the same for the operations in Eastern Europe. I am confident that we will continue to successfully develop our activities in Germany and Spain. Personally, I look forward to new tasks and working to advance growth areas at Bertelsmann.”

About Bertelsmann

Bertelsmann is an international media company encompassing television (RTL Group), book publishing (Random House), magazine publishing (Gruner + Jahr), media services (Arvato), and media clubs (Direct Group) in more than 50 countries. Bertelsmann’s claim is to inspire people around the world with first-class media and communications offerings – entertainment, information and services – and occupy leading positions in its respective markets. The foundation of Bertelsmann's success is a corporate culture based on partnership, entrepreneurial spirit, creativity, and corporate responsibility. The company strives to bring creative new ideas to market and create value.