Mobileread
OverDrive sold to private equity firm KKR
#1  odamizu 12-25-2019, 04:29 PM
The Christmas Eve timing of the announcement is curious — as if they wanted this news to fly under the radar.

from BusinessWire:

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KKR, a leading global investment firm, today announced the signing of a definitive agreement to acquire OverDrive, Inc. (“OverDrive” or the “Company”), the leading digital reading platform for libraries and schools, from Rakuten USA ...

from MarketWatch:

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The two sides did not provide a price tag for the Ohio-based property, which Rakuten purchased for $410 million in 2015 , but Rakuten said it would recognize about $365.6 million in profit from the sale
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#2  binaryhermit 12-25-2019, 05:51 PM
The timing does seem weird...
And given how private equity firms generally operate firms they acquire... RIP Overdrive?
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#3  rcentros 12-25-2019, 06:37 PM
Quote binaryhermit
The timing does seem weird...
And given how private equity firms generally operate firms they acquire... RIP Overdrive?
Well... rats. I guess KKR bought RBDigital last year. I wonder if Rakuten is also marketing Kobo.
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#4  DuckieTigger 12-25-2019, 07:24 PM
Interesting. I wonder if the OD integration into Kobo ereaders will survive.
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#5  Pajamaman 12-25-2019, 09:37 PM
Interesting. I think ratakun paid a lot of money for it. Did they stymy Amazon?
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#6  stumped 12-26-2019, 08:06 AM
so all software solutions to borrow e-books from libraries will be under the thumb of a single private equity firm ( who may merge Overdrive with Rbdigital or kill one to promote the other)

I don't see this ending well, for us consumers
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#7  John F 12-26-2019, 09:30 AM
Quote stumped
so all software solutions to borrow e-books from libraries will be under the thumb of a single private equity firm ( who may merge Overdrive with Rbdigital or kill one to promote the other)

I don't see this ending well, for us consumers
Aren't there other alternatives, like FReading?
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#8  stumped 12-26-2019, 10:12 AM
Quote John F
Aren't there other alternatives, like FReading?
never heard of them but ok - a google search shows some USA libraries use them, dunno how many.

I thought overdrive had most of the library market, except where Rbdigital had under-bid them on renewals( which is what happened with my library )

wikipedia says
[overdrive's]global network includes more than 43,000 public libraries, K-12 schools, colleges and universities, and corporations in 75 countries worldwide.

I cant easily find comparable figures for the others,
but looking for freading on google play it had only 500+downloads [ and 1 terrible review] , compared to 1M+ for libby & 5M+ for overdrive, so hardly a serious competitor ?
RBditial is 500k+ and borrowbox 100k+

so judging from downloads, overdrive has 10x the users of Rbdigital , & 2,000x the users of Freading
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#9  fjtorres 12-26-2019, 11:46 AM
One of the ways these firms operate is to buy wholly owned subsidiaries to take them public. Also, it is worth remembering that library ebook lending isn't the only thing Overdrive does, just their dominant revenue stream.
They are also ebook distributors for white label ADEPT ebookstores. A dying business, I know, but their Libby app is all over the place--well over a million installs on Android--so they are a viable candidate to add ebook sales to Libby and add a consumer business.

They have the visibility and back end capabilities to expand into ebook and audiobook retail and challenge Amazon. They could also look to pbooks to challenge Ingram now that Baker and Taylor is out of the trade book distribution business. Or, less likely, they mivht buy Ingram.

Also, if B&N wants to get rid of Nook or their pbook distribution system (as suggested by Shatzkin), KKR could buy it cheap and combine the three properties, run it a year, and IPO it.

They paid a premium for Overdrive so expansion and IPO is the more likely plan.
What remains to be seen is how they go about it.

This could get interesting.
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#10  bookyboy 12-26-2019, 05:35 PM
Gross. Just gross.

Private equity. Ugh.

It makes me wonder if they are looking to part with all of Kobo at some point also
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