Hungry Minds Acquisition
The Wiley acquisition of Hungry Minds, Inc., the largest in our history, brings a diverse family of respected brands under the Wiley umbrella. The acquisition changes the balance of our core businesses by substantially augmenting our market position and visibility in key areas.
Everyone is familiar with the For Dummies® series. For over a decade, the ubiquitous yellow and black covers have helped us follow the yellow book road, first through the cyberworld, and, by now, much of the rest of life as well.
The Hungry Minds portfolio includes several other equally well-known brands. On the consumer side:
The famous CliffsNotes™ study guides
The Webster's New World™ dictionaries
The Frommer's®travel guides
The Betty Crocker®and Weight Watchers® cookbooks
The Burpee® gardening titles
The Howell Book House™ pet series.
On the technical side, Hungry Minds is one of the world's major computer publishers, and a leader in the end-user market. The For Dummies® series has been one of the fastest growing publishing programs in history; Windows For Dummies® is regularly on the computer bestseller lists, with over 11 million copies in print. The Bible, Visual™, and Secrets® lines, offering higher end material for programmers in such disciplines as Web development and network administration, also consistently produce major bestsellers.
Hungry Minds authors include an impressive number of high-profile experts from across the subject spectrum. Windows guru Andy Rathbone can make anyone an informed traveler in the land of Gates, and for Mac devotees there are the renowned David Pogue and Deke McClelland. Dave Thomas of Wendy's fame teaches the secrets of franchising, while acclaimed Chicago chef Charlie Trotter offers a more hand-crafted approach to culinary creation. Former Metropolitan Museum of Art director Thomas Hoving provides a guided tour of the world of art. Sports fans and wannabes can learn from the greats including baseball Hall of Famer Joe Morgan, ice skating queen Kristi Yamaguchi, Field & Stream veteran Ken Schultz on fishing, and John McEnroe's better-behaved brother Patrick on tennis. Victoria's Secret supermodel Stephanie Seymour counsels on beauty, and in the most personal arena, we encounter the diminutive doyenne of intimacy, Dr. Ruth Westheimer.
An Ideal Fit
The Hungry Minds programs will be aligned with Professional/Trade. The acquisition will double P/T revenues, bringing them to well over half the Wiley total.
The Wiley/Hungry Minds combination brings us the additional opportunity to leverage online investments across a broader base of content and markets. In the online travel category, an area that we believe holds strong growth potential, Frommers.com generates revenue not only through advertising, but through a booking partnership with Travelocity as well.
The Hungry Minds in-house composition and content tagging process, designed for both print and digital publication, can be aligned with the content management system Wiley is currently developing. About 300 of the For Dummies®, Frommer's®, and CliffsNotes™ publications are already available for full e-book download, custom print, or e-book on-demand publication. While Hungry Minds has not been utilizing a full e-book distribution network, this content can be distibuted under existing Wiley relationships.
We expect synergy in other areas as well. The significant brand management expertise at Hungry Minds will support us in our ongoing pursuit of successful partnerships and alliances. On the international scene, the Hungry Minds experience has been comparable to ours, with about 15% of sales coming from outside the U.S. Hungry Minds has achieved strong market penetration in Canada, Singapore, Australia, and India.
While Indianapolis is the major hub of Hungry Minds operations, housing about 350 of the over 500 employees, its corporate headquarters are in New York City, at 909 Third Avenue. The two floors at that location are soon to be consolidated onto the 20th floor. A small office in Cleveland houses the 13 member Webster's New World™ editorial staff.
The integration of Hungry Minds into Wiley is being effected by a transition team which represents both companies. The enthusiasm with which Wiley has anticipated the union is clearly shared by Hungry Minds. There has been a wonderful collaboration among the various departments throughout the transition process, says Kathy Nebenhaus, Hungry Minds Vice President and Publisher. The combined portfolio of products will enable our customers to learn and to enrich their lives on a broader spectrum. And as Wiley President and CEO Will Pesce says, We welcome the Hungry Minds team of dedicated professionals, and we look forward to making the marriage intellectually stimulating and financially rewarding for all the stakeholders of the combined company authors, shareholders, and employees.