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Bonnier AB

Bonnier AB

Torsgatan 21
113 90 Stockholm
Sweden
Telephone: +46-8-736-40-00
Fax: +46-8-728-00-28
Web site: http://www.bonnier.se

Private Company
Incorporated:
1837 as Albert Bonnier Forlag
Employees: 10,342
Sales: $1.59 billion (2001 est.)
NAIC: 323111 Commercial Gravure Printing; 451211 Book Stores; 511110 Newspaper Publishers; 511120 Periodical Publishers; 511130 Book Publishers; 511140 Database and Directory Publishers; 722110 Full-Service Restaurants

Bonnier AB is one of the Nordic regions leading media groups, losing out the top spot to Finlands SanomaWSOY in 2001. Based in Stockholm, Sweden, the Bonnier family-owned group is active in newspapers, magazines, book publishing, film and television productionnotably through subsidiary Svensk Filmindustrieand other multimedia activities, movie theaters, and retail operations, including book and music clubs. Bonniers newspaper titles include some of the most prominent in the Scandinavian region, such as Dagens Nyheter, Dagens Industri, and Expressen. The company also has branched out beyond the region with newspaper titles including Business AM, a daily business paper for the Scottish market; Wirtschaftsblatt, published in Austria; and Diena, which has become the leading daily newspaper in Latvia. Bonniers Magazine division publishes a huge list of magazine titles in a variety of international markets, and includes titles such as Amelia, a womens lifestyle magazine for the Scandinavian markets; gardening magazine Hagen for alle; Veckans Affairer, a business magazine, and the weekly Bonniers Veckotidning. Bonniers Publishing division represents its historical core, consisting of flagship imprint Albert Bonnier and a number of international publishing houses, including Cappelans in Norway; Piper, Hoppenstedt and Thienemann in Germany; Tammi in Finland; and comic book publisher SEMIC. Under its Retail division, Bonnier groups its book, music, and video clubs, including Bonnier Bokklubb, the largest in Sweden. The company also owns stakes in broadcasting, including 25 percent of Swedens TV4 and a controlling stake in Finlands Alma Media. Bonnier is controlled by the Bonnier family and led by Chairman Carl-Johan Bonnier and President and CEO Bengt Braun.

Founding a Swedish Publishing Empire in the 19th Century

The Bonnier publishing dynasty was founded in the early years of the 19th century by a German-Je wish immigrant, Gutkind Hirschel, who had come to Denmark in 1801, settling in Copenhagen. The son of a banking family in Dresden, Hirschel at first supported himself by giving French lessons, then entered the book trade, opening his first bookshop in 1804. By then, Hirschel had married and changed his name to the more neutral (and French-sounding) Gerard Bonnier.

Although book selling remained at the heart of Bonniers business, he added newspaper publishing in 1816, founding the daily newspaper Dagsposten. Bonnier also had begun to develop business contacts with Sweden, in part to respond to the poor economic climate in Denmark of the period. In the mid-1820s, Bonnier sent his oldest son Adolf, then 21 years old, to Sweden to search for a suitable location for expanding the family bookselling business. In 1827 the family opened their second bookstore, in Gothenburg. Adolf was joined by younger brother David, who took over running the Gothenburg shop while Adolf opened a second Swedish store in Stockholm in 1832. David Bonnier later went on to found a daily newspaper, Göteborgs-Posten, in 1859, which was sold off in 1870.

Another Bonnier brother, Albert, expanded the familys growing Swedish interests in 1837 when he opened his own bookstore in Stockholm. By then the family had entered the book publishing business, when Adolf Bonnier had begun publishing art books in 1834. Yet the major force behind the Bonnier familys growth soon became Albert Bonnier, who began his own publishing operations in 1837. Albert Bonnier became a noted literary figure in Sweden, whose titles included Proof That Napoleon Never Existed.

Albert Bonniers commitment to literature and excellent business skills helped build Albert Bonnier Forlag into a noted Swedish publishing house by the middle of the 19th century, with a reputation for its imported titles, and for launching playwright Strindberg. Bonnier added a number of strong titles, such as the Sveriges Handelskalendar, Folkkalendern Svea, the weekly publication Stockholms Figaro, and Hörbergska Tryckas, acquired in 1856. When brother David fell ill, Albert Bonnier bought up the Göteborg bookstore in 1864.

The year 1864 also marked the founding of a new daily newspaper, Dagens Nyheter in Stockholm. Launched by Rudolf Wall, an associate of Albert Bonnier, the newspaper was to grow into one of Swedens most prominent papers. Bonnier helped finance the newspapers launch. A restructuring of Dagens Nyheter gave Bonnier a minority stake in the company. Under Alberts son Karl Otto, who joined his father in the business in the 1880s before taking over as the head of the Bonnier familys bookstore and publishing group after Alberts death in 1900, Bonnier gradually increased its stake in Dagens Nyheter, gaining control in 1909. By then the company had launched another newspaper geared toward children, called Kamratposten, in 1892.

The Bonnier publishing operations expanded strongly under Karl Ottos leadership, and by the outbreak of World War II, the Bonnier family had built one of Swedens most prominent media groups. Karl Otto was joined by his sons, Tor, Ake, and Kaj, who each played an important role in the groups development. Tor Bonnier, Karl Ottos oldest son, played an especially important role in building the familys media interests, particularly in expanding its horizons.

In the first half of the 20th century, the Bonnier group extended its operations beyond its traditional core of book publishing, adding additional newspapers and, in particular, increasing its stake in Dagens Nyheter. The Bonnier family also branched out into magazine publishing, launching the weekly title Bonniers Veckotidning {Bonniers Magazine) in 1923 and Hemma (Housewife) in 1924, before dramatically boosting its magazine holdings with the purchase of Ahlen & Akerlund, then the largest magazine publisher in Sweden, in 1929.

Postwar Diversification

Although Swedens neutrality during World War II protected the Bonnier family, the prevailing political climate forced the Bonniers to slow their growth. In 1944, however, the Bonniers moved forward again with the launch of an evening newspaper, Expressen. Taking a somewhat radical left-wing position in order to counter the right-leaning (and Nazi sympathizing) tone of the existing evening paper Aftenbladet, Expressen quickly took over the evening market, becoming one of the countrys most widely read newspapers. The Bonniers launched a number of other successful publications in the immediate postwar era, including the magazine Ar et Runt in 1946, and the comics group SEMIC in 1950.

Key Dates:

1804:
Gerard Bonnier, a German immigrant who had changed his name from Gutkind Hirschel, establishes a bookstore in Copenhagen.
1816:
Bonnier begins publishing the daily newspaper Dags-posten.
1827:
Bonniers son Adolf opens a bookstore in Gæteborg, Sweden.
1832:
Adolf Bonnier opens a second store in Stockholm.
1834:
Bonnier begins publishing operations.
1837:
Brother Albert Bonnier also opens a bookstore in Stockholm and begins a publishing business, Albert Bonnier Forlag.
1859:
AB Forlag begins publishing Svergie Handelskalender.
1864:
The Dagens Nyhets daily newspaper is founded.
1873:
Albert Bonnier becomes a shareholder in Dagens Nyhets; the Bonnier family gains control of the newspaper in 1909.
1923:
AB Bonnier branches out into magazine publishing with Bonniers Veckotidning.
1929:
The Bonnier family acquires the Ahlen & Ackerland magazine group.
1944:
The evening daily newspaper Expressen is launched.
1952:
The Bonnier family holdings are restructured under Bonnierföretagen AB holding company; the newspaper group remains separate as Dagens Nyheter (later renamed Tidnings AB Marieberg and taken public on Stockholm exchange).
1973:
Svensk Filmindustrie is acquired through Dagens Nyheter.
1977:
The company bundles part of its industrial holdings as public company Grafoprint (later divested).
1987:
The company acquires Cappelans, the third largest book publisher in Norway.
1990:
The Scandinavian Music Club is acquired.
1995:
The weekly magazine Amelia is launched.
1997:
Bonnierföretagen acquires Marieberg and delists it.
1998:
Bonnierföretagen AB restructures itself as a holding company, Bonnier AB.
2000:
Bonnier acquires Hoppenstedt, of Germany, and launches a new business daily newspaper in Scotland.
2001:
Bonnier acquires Thienemann.
2002:
The company announces its intention to bid for soon-to-be privatized TV2.

The postwar period marked a number of changes for the Bonnier family group. For one, the Bonniers sought to diversify their holdings beyond media publishing, a move that had already been begun, in fact, in the 1930s. In 1946 the group added graphics and printing capacity when it launched the companies Grafisk Färg and Solna Ioffset. In 1949 the family, through its Dagens Nyheter holding, bought up the Billingsfors paper mill, which in turn led to the foundation of the Duni group. During the 1950s, the Bonniers continued adding industrial operations, limiting growth primarily to such publishing support areas as magazine paper and ink production. In the 1960s, however, the company began a wider industrial diversification and by the 1970s the groups holdings ranged from manufacturing mattresses and other furniture to recreational equipment and cancer testing equipment.

Until the early 1950s, the Bonnier familys broadened media holdings had been owned and conducted by brothers Tor, Ake, and Kaj. Yet the familys activities had for the most part been operated as three separate businesses, Albeit Bonnier Forlag, the book publishing wing; the money-losing Ahlen & Akerlund magazine division, led by Kaj Bonnier; and the Dagens Nyheter and Expressen newspaper group. With the next generation waiting to join these family operations, the Bonnier s moved to consolidate their various holdings into a single entity, Bonnierföretagen AB or Bofo, in 1952. The creation of Bofo, however, soon led to tensions within the family, particularly between Tors son, Albert, Jr., who had taken over his fathers share of the business, and Kaj Bonnier. By the end of 1952, Bofo had bought out Kaj Bonniers stake in Bofo; as part of that buyout, the family spun off the Dagens Nyheter newspaper group into a separate company, in which Kaj Bonnier maintained his ownership stake.

Albert Bonnier was placed in charge of Bofos magazine division, but quickly took on the role of CEO for the entire group. In 1957, as Bonnier moved to step up the companys industrial diversification, Albert Bonnier turned over management of the magazine division to brother Lukas, while cousin Gerard was given the lead of the companys book publishing operations. Nonetheless, Albert Bonnier emerged as the clear family leader and was credited with transforming Bofo into a major Scandinavian media group.

Facing growing resistance within Sweden because of its dominance of the countrys media market, Bonnier began eyeing international expansion, starting with a partnership agreement made with Denmarks Fogtdal newspaper group in 1959. In 1969, Bofo acquired a 49 percent share in Danish publishing group Forlaget Borsen. During the 1970s, Bofo stepped up its foreign operations with the 1976 purchase of Frances Editions La Croix, which was subsequently renamed Publications Bonnier.

A more significant move in the expansion of Bonniers media empire came with its acquisition, through Dagens Nyheter, in 1973, of Swedish film and television product leader Svensk Filmindustrie. That acquisition also gave the Bonnier family control of SF Bio, which was to become the leading cinema operator in Sweden. The companys film production division was later boosted by the purchase of the Europe Film production company in 1984. By then, Bofo had taken direct control of Svensk Filmindustrie as well, acquiring that company from the Dagens Nyheter group. The newspaper concern, meanwhile, had been expanding as well, launching a new business daily, Dagens Industri, in 1976. Yet the Dagens Nyheter group found itself struggling during the decade as readership and advertising revenues declined.

Until the mid-1970s, Bofo had been able to raise capital investment through transfers arranged among its various member firms. Changes in Swedens tax laws, however, forced the private family group to seek outside capital. In 1977, the company grouped together three of its industrial operationsDuni, Solna, and Billingsforsand launched them as public company Grafoprint. Nonetheless, Bofos industrial operations were becoming a drain on the rest of its activities, as Bofo found itself unable to make the capital investments necessary to expand those businesses. By the end of the 1980s, Bofo had sold or closed most of its nonmedia assets. Meanwhile, the Dagens Nyheter newspaper group also was taken public, listed as Tidn-ings AB Marieberg.

Scandinavian Media Powerhouse in the 21st Century

In the mid-1980s, Bofos operations generated some SKr 4 billion ($520 million). The companys media operations nonetheless represented the largest part of those revenues. With its exit from industrial operations, Bofo focused its efforts on expanding its media holdings. The company began making new acquisitions, including Cappelens, one of Norways top three book publishers, in 1987. The company had made other book publisher acquisitions, building up a list that included imprints such as Forum, Viva, and Wahlstrom & Widstrand. Other acquisitions followed, including Scandinavian Music Club, the largest in the region, in 1990. In that year, also, the company formed a joint venture with Germany Hoppenstedt to form the business information publishing group Hoppenstedt Bonnier. The following year, the company acquired noted Swedish book publisher Trevi. By then, Bofo revenues had topped SKr 7.5 billion (nearly $1.2 billion).

The Bonnier group continued acquiring scale in the 1990s, buying the daily newspaper Sydsvenska Dagbladet, through Mariberg, and adding German publisher Piper in 1994, launching the Wirtschaftblad daily financial paper in Austria in 1995. In 1994, also, the company launched its own multimedia wing, Bonnier Multimedia. Two years later the company launched the new magazine Amelia, which represented one of the most successful new magazine launches in the Scandinavian region in that decade. The company moved into Finland that same year with the purchase of publishing group Kirjakanava, the countrys third largest publisher. Marieberg, meanwhile, had provided the company with an entry into the television market, with a stake in the Swedish pay-television channel TV4. The company continued building up its holding in TV4, raising its stake to 25 percent by the end of the decade.

In 1997, the Bonnier family and Bofo moved to take full control of Marieberg; under the terms of the shareholder buyout, the Bonniers were guaranteed control of the newspaper group up to 2030. Bofo then delisted Marieberg from the Stockholm exchange. The deal, which cost Bofo some SKr 5.4 billion, was financed by bank loansmuch of which were paid off through sales of the Bonnier familys extensive portfolio of landmark real estate in Stockholm and elsewhere. Following the absorption of Marieberg, Bofo was restructured into a holding company, under the new name Bonnier AB, in 1998.

By then, Bonnier had begun acquiring a position in the newly formed Alma Media Group, based in Finland, which had been formed through the merger of the Aamulehti newspaper group and the Finnish television group MTV3. Bonnier continued to increase its holding in Alma into the beginning of the new century, raising its stake to 33 percentjust below the automatic poison pill trigger point of 33.3 percent that would require the company to make a formal takeover offer. Bonnier, however, maintained its satisfaction with its minority shareholder status.

Bonnier continued its expansion into the 21st century, extending its SF Bio cinema operation into Norway in 1999, then buying up the Hoppenstedt publishing group and fellow German publisher arsEdition, in 2000. In that year, the company moved beyond Scandinavia with the launch of Business AM, a daily business newspaper for the Scottish market. In 2001, Bonniers acquisitions included a 50 percent stake in Forlaget Benjamin, based in Denmark, and the takeover of Verlag Thienemann, of Germany.

The coming deregulation of the European media marketwhich was expected to loosen foreign ownership restrictionswhetted Bonniers appetite for acquisitions, as the company announced its intention to play a role in the coming consolidation of the northern European media market. In September 2002, the company announced its intention to bid for the soon-to-be privatized Swedish television station TV2, scheduled to be put up for sale in 2003. The company also continued to expand its newspaper holdingsunder pressure with the successful entry of the free daily commuter paper Metro with the launch of its own commuter daily, Stockholm City, at the end of October 2002. Bonniers CEO Bengt Braun also suggested that the company had begun considering opening up its shareholdingwhether in a public offering or by selling a stake in the company outrightin order to finance its continued expansion.

Principal Divisions

Bonnier AB; Bonnier Newspapers; Bonnier Books; Bonnier Magazine Group; Bonnier Business Information; Bonnier Entertainment; Bonnier Business Press.

Principal Competitors

Bertelsmann AG; Pearson pic; Reed Elsevier pic; United News & Media pic; Wolters Kluwer NV; Gruner Jahr AG & Co. Druck-und Verlagshaus; Reed International pic; Daily Mail & General Trust pic; Axel Springer Verlag AG; EMAP pic; WH Smith PLC; LOGISTA S.A.; FNAC S.A.; LOGISTA SA; FNAC SA; Reitan Handel ASA; Reitan Narvesen ASA; John Menzies PLC; Ingram Book Group Inc.; Follett Corp.; Sanoma WSOY Group; Timon S.A.; Union INVIVO; Anderson News Co.; Maruzen Company Ltd.; Relais FNAC; Dawson Holdings PLC; Ruch S.A.; Timon SA; Surridge Dawson Ltd.; Ringier AG; Condé Nast and National Magazine Distributors Ltd.; Libro AG.

Further Reading

Another Free Newspaper Tries for a Share of Swedish Market, AP Worldstream, October 21, 2002.

Curtis, Jim, A Nordic Invasion, Campaign, November 24, 2000, p. 38.

Larsson, Mats, Bonniers - en mediefamilj. Förlag, konglomerat och mediekoncern 1953-1990, Stockholm: Bonnier AB, 2001.

Lottman, Herbert R., Growth at Bonnier, Publishers Weekly, April 24, 2000, p. 20.

One of Swedens Largest and Oldest Newspapers to Cut Staff, Change Format, AP Worldstream, June 18, 2002.

Peltola, Anna, Bonnier Prepares for Onslaught of U.S. Media, Reuters, March 8, 2002.

M.L. Cohen

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