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PARTISAN REVIEW
Brace Jovanovich found out in 1987. In May, HBJ employed com–
plex financial maneuvers to fight off the attentions of suitor Robert
Maxwell, a socialist British billionaire (two adjectives and a noun
that Evelyn Waugh never managed to put together). The cost of
resistance was high; the debt incurred to avoid the fate of becoming
Maxwell House, so to speak, has forced a necessarily cost-conscious
HBJ to adopt painful belt-tightening measures - and to bailout of
its magazine unit for less cash than would have been raised if Black
Monday hadn't happened last October 19th.
Just two months before rebuffing Maxwell, HBJ had itself tried
unsuccessfully to acquire Harper
&
Row. That famous imprint went
to a consortium headed by newspaper nabob Rupert Murdoch in
conjunction with the British publisher William Collins PLC. Will
there be major changes at Harper
&
Row? There are bound to be.
Just consider that the new owners are already into it to the tune of
$300 million; that's what an auction will do to a purchase offer.
There are reasons for the sudden influx of foreign capital,
British and West German, into the New York publishing scene. The
short-term
Economics 101
answer points to the weak American dollar
and the safe American market, the new U.S. tax law (which made it
advantageous for sellers to close on their deals sooner rather than
later), and external circumstances (the cash-rich West Germans
were prevented by strict antitrust laws from expanding at home) .
The long view is that the capital is flowing both ways , because the
publishing industry has gone, or is on the verge of going, global.
"What you're seeing," says Simon
&
Schuster's Richard
Snyder, "is the rationalizing of publishing in America." Being ra–
tional means, in this case, turning your sights on foreign markets.
Snyder's firm recently set up a trade publishing division in London
and is actively on the lookout for British companies
to
acquire ; Ran–
dom House, meanwhile, has pitched its tents in London by buying
up Chatto
&
Windus, Jonathan Cape, and The Bodley Head. As
Snyder sees it, "We've gone from a cottage industry to a professional
publishing industry, and the next step is globalization. It's inex–
orable that it will come ."
Roger Straus, Jr., the outspoken founder and CEO of Farrar,
Straus
&
Giroux , is ideologically opposed to the conglomerate mind
in publishing, but that doesn't make him any less shrewd in assessing
what the process of globalization entails. Straus's assessment tallies
neatly with Snyder's. According to Straus, the major New York pub–
lishers have, in effect, broken their own sound barrier in two stages.
