PGW-AMS: The FAQ
By Jim Milliot and Steven Zeitchik, PW NewsLine -- Publishers Weekly, 1/17/2002
How both PGW and AMS will look after their merger closes is still coming into focus, but here are some points that already seem clear.
- Excluding the summer, Charlie Winton will stay at PGW through next January, mentoring Kevan Lyon (the San Diego-based AMS exec to whom PGWers will report) and reassuring employees and publishers that things won't change too drastically under new management. PGW executives will remain in Berkeley, Calif., and its New York City sales office will remain open. Layoffs would be far-off and minuscule, if they happen at all, the company says.
- The purchase of PGW for $37.3 million immediately makes AMS the most significant player in the distribution field. Michael Nicita, AMS president, had previously told analysts that Advanced Global Distribution, the company's distribution arm, would become a "hundred-million-dollar" operation. PGW had revenues of approximately $125 million in 2001 "with a record of profitability" and margins in the 20%-30% range.
- Over the course of the next several months, both AGD's domestic and international clients (including AMS's own publishing program) will become part of PGW, which will keep open its Reno, Nev., warehouse.
- The deal does not include the Avalon Publishing Group, which PGW founder Charlie Winton and a group of employees will buy before the sale of the distribution business.
- AMS will have no ownership interest in Avalon, although its titles will continue to be distributed by PGW. In addition, AMS is supporting the Canadian distributor Raincoast Books' purchase of PGW Canada. AMS owns a 25% stake in Raincoast.
- In addition to being a boon for Winton, who founded the company, the sale also provides a nest egg for more than a few PGW employees, whom Winton rewarded with stock options over the years.
