B & N's Purchase of Ingram Seen As Danger (fwd)

[Frances Bolton (PHI)]

Man the Barricades: 
Barnes & Noble's Purchase of Ingram Seen As Danger

    Friday's announcement that bookselling giant Barnes & Noble is
acquiring book distribution giant Ingram for $600 million in cash and
stock has set off alarm bells across the publishing and bookselling 
world. The purchase would put Barnes & Noble in control of the 
primary distributor for its chief online bookselling rival, Amazon.com, 
and for most small chains and independent bookstores throughout 
the country.

"So it's true," Publishers Weekly reported in its online newsletter. 
"The days of speculation end with the shocking announcement that 
B&N will buy Ingram for a cool $600 mil.

"The purchase, which will consist of $200 million in cash and $400 
million in B&N stock, will make the entire Ingram Book Group, which 
consists of Ingram Book Company, Retailer Services Inc., Ingram 
Periodicals, Spring Arbor Distributors, Publishers Resources, Inc. 
Ingram International, Tennessee Book Company, Lightning Print 
and Ingram Library Services, a wholly-owned subsidiary of B&N. 
The deal is expected to be completed within 45 days, pending 
approval by government agencies. Steve Riggio,
vice-chairman of B&N, said he did not expect any anti-trust 
problems with the transaction."

    The American Booksellers Association has issued the following 
official statement (available on the ABA BookWeb site at 
http://www.bookweb.org):
"The American Booksellers Association (ABA) considers the 
purchase of Ingram Book Company by Barnes and Noble, Inc., to 
be a devastating development that threatens the viability of 
competition in the book industry, and limits the diversity and 
availability of books to consumers. The Board of Directors of the 
ABA call on the Antitrust Division of the U.S. Department of Justice 
and the Federal Trade Commission to investigate the proposed 
acquisition and to take prompt and decisive action to stop this 
blatantly anti-competitive combination.

"This acquisition, should it be allowed to take place, is just one more
example of the large scale corporate consolidation that has 
infiltrated every corner of our culture. As the desire intensifies to 
increase bottom line profits no matter what the other consequences, 
so does the concentration of power in the book industry. 
Consumers are left with an environment in which fewer and fewer 
people are deciding which books get published, and ultimately, 
which books Americans can read and buy.

"Barnes & Noble, a $3 billion company and the largest US book 
retailer, recently entered into an alliance with the $14 billion media 
giant, German-owned Bertelsmann AG. Ingram Book Company is 
the largest book wholesaler in the United States, with over a billion 
dollars in sales to independent bookstores and other competitors of 
Barnes & Noble. Now, with Barnes & Noble's proposed acquisition 
of the billion dollar Ingram Book Company, there can be little doubt 
that the book industry is falling prey to the same anti-competitive ills 
that currently plague the computer software and other industries. 
This deal would make independent bookstores virtually dependent 
upon their largest competitor, one which the ABA alleges in pending 
antitrust discrimination litigation in San Francisco has had a long-
standing, systematic strategy of driving independents out
of business to stifle competition.

"While there are some smaller, unaffiliated book wholesalers that 
provide independent booksellers with excellent service, Ingram 
Book Company is a primary distribution source for the vast majority 
of ABA member stores, and we consider this development to be 
deeply troubling.  We will use all of our strength and available 
resources to fight it."

    ABA President Richard Howorth has asked member bookstores 
to write to Attorney General of the United States Janet Reno and 
Federal Trade Commission Chairman Robert Pitofsky to protest the 
acquisition, and the ABA is providing a model letter (echoing the 
positions in the statement above) on its BookWeb site: 
http://www.bookweb.org/news/pressroom/1477.html



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