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Baker & Taylor Sold

3 Jul, 2003 By: Holly J. Wagner

Distributor Baker & Taylor, Inc. has been sold to private equity investment firm Willis Stein & Partners by The Carlyle Group for $255 million, the parties announced today.

“We are excited about this next stage in the 175-year history of Baker & Taylor,” commented Jim Ulsamer, president of Retail. “Willis Stein made the investment in Baker & Taylor because of our excellent position in diverse markets, strong operating performance during challenging economic times and, most importantly, the opportunity to significantly grow and improve the business.”

Charlotte, N.C.-based Baker & Taylor is a global company that offers books, video, music and services to traditional and Internet retailers, libraries and educational institutions. For home video products, the company primarily serves Internet retailers.

At the sale's closing, Willis Stein will appoint Richard Willis as the new CEO and president, Gary Rautenstrauch, Baker & Taylor's CEO and president, told employees. Willis brings more than 20 years of experience in the media and manufacturing industries. Rautenstrauch will remain involved with the company through the transition.

Because the transfer of ownership is between investors, the deal is unlikely to change operations in the near term.

“As a financial sponsor rather than a strategic one, there is no infrastructure or other stuff that would suggest any kind of consolidation, nothing that the acquisition will affect,” Ulsamer said. “There will be an emphasis on growing the business, so down the road there might be a look at acquisitions” as the company seeks to expand its distribution network.

“The deal doesn't go through for a couple of weeks until it clears regulatory hurdles. There will be changes in the business and it may mean changes in the work force,” he said, adding those changes would be in response to changes in the market, not Baker & Taylor's ownership.

The Carlyle Group acquired Baker & Taylor Books, Baker & Taylor Video and Soft Kat businesses from W.R. Grace & Co. in March 1992. During Carlyle's ownership, Baker & Taylor has grown revenues by about 50 percent and operating cash flows by about 300 percent. Carlyle attributed the growth to a combination of “intrinsic growth, acquisitions and superior execution.”

“Carlyle has been a great partner of Baker and Taylor over these past years, helping to position the company strategically within its markets and achieve its growth and profitability objectives,” Rautenstrauch said.

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