Perseus Signs PGW Clients

By Jim Milliot -- Publishers Weekly, 1/31/2007

Perseus has started to receive signed agreements from PGW clients who will move their distribution to the company. Perseus CEO David Steinberger said he had received "more than 10" contracts since they began coming in yesterday. Late last week, Steinberger and PGW head Rich Freese met with a group of PGW clients in the San Francisco Bay Area. "The sessions went well. We did a lot of listening," Steinberger said.

During the meetings, Steinberger reiterated that he has "a very high regard" for PGW and its staff and that if Perseus is successful in its bid for the distributor, Perseus will bring on a significant number of PGW employees. He couldn't say precisely how the PGW operation will be integrated into Perseus, but did say that Perseus will "maintain a presence in the Bay Area. There is such a concentration of publishers there that it is vital to have a presence."

Not all publishers have yet received an offer, but Steinberger said Perseus is getting them out "as quickly as we can." Perseus needs to have 65% of PGW clients on board before the February 12 hearing on the proposal. Steinberger said he knows the 70 cents–on-the-dollar offer "doesn't make the publishers whole, but it is the best we can do." Perseus's entire proposal is contingent on the premise that the PGW publishers' retain ownership of their inventory. Although the bankruptcy court has yet to make a final determination on this point, indications are that the books will be considered the publishers' property, not an AMS asset.