Davis Polk is advising Bertelsmann SE & Co. KGaA on its acquisition of a 22% stake in Penguin Random House from co-owner Pearson plc. The acquisition will give Bertelsmann a 75% stake in the book group, whose enterprise value has been set at $3.55 billion for this transaction. The transaction is subject to approval by the relevant authorities.

Bertelsmann is a media, services and education company that operates in about 50 countries around the world. It includes the broadcaster RTL Group, the trade book publisher Penguin Random House, the magazine publisher Gruner + Jahr, the music company BMG, the service provider Arvato, the Bertelsmann Printing Group, the Bertelsmann Education Group and Bertelsmann Investments, an international network of funds. Penguin Random House is comprised of around 250 individual publishers on five continents, which publish more than 15,000 new books each year. The group’s renowned authors include John Grisham, Dan Brown, Barack and Michelle Obama, as well as Paula Hawkins.

The Davis Polk corporate team includes partner Michael Davis, counsel Ajay B. Lele and associate Shanu Bajaj. Partner Michael Mollerus, counsel Ethan R. Goldman and associate Aliza Slansky are providing tax advice. Partner Frank J. Azzopardi and associate Paul S. Lee are providing intellectual property and technology advice. All members of the Davis Polk team are based in the New York office.

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