CBS Buys Books

In a series of acquisitions starting in 1964, CBS's big eye has fallen most notably on such things as banjos and baseball. Though he has long proclaimed his company's "enthusiasm for those things which can improve the process of education," CBS Chairman William S. Paley has been tardy in joining the emerging knowledge industry. Last week Paley announced that CBS was enrolling at last by buying out--in a deal involving an estimated $275 million in CBS stock--Manhattan's venerable publishing house of Holt, Rinehart & Winston.

The acquisition of Holt will give CBS a prime spot in the knowledge industry, which is largely based on corporate partnerships that wed electronics and the printed word so as to participate in the U.S.'s education explosion. Since 1965, Raytheon has bought Boston's B.C. Heath, Xerox has assumed control of the Wesleyan University Press, and RCA, parent of CBS's great rival, NBC, has taken over Random House, is also diversifying in other ways (see following story). Time Inc. and General Electric have gone into a fifty-fifty partnership in a new firm called General Learning Corp. Beverly Hills-based Litton Industries plans to buy the American Book Co.

At various times, CBS has looked over Curtis Publishing Co., held inconclusive talks with the Boston textbook house, Allyn and Bacon. With Holt, the indirect approach proved more successful. Holt President Alfred C. Edwards was caught by surprise last September when CBS paid some $19 million for the stock held by his biggest (10.8%) shareholders, Texas Entrepreneurs Clint and John Murchison. Upset at the time, Edwards since has warmed to the idea of CBS's rich (1966 sales: $815 million) corporate shelter.

Itself the prosperous product of a 1960 merger of 101-year-old Henry Holt & Co. and two other houses, Holt depends on its school texts and other educational materials for 80% of its business. Its general book division, which has published Robert Louis Stevenson, William James and Robert Frost, has declined to 7%. For the rest, Holt has not only a growing business in educational movies and other teaching aids, but a group of four magazines, including that staunch sportsman's standby Field & Stream. Overall earnings last year rose 28%, to $6.6 million on sales of $70 million--enough to make it CBS's third biggest moneymaking division, after TV and Columbia Records.

All in all, CBS already has more acts going than the Ed Sullivan Show. Beyond its established operations in radio and TV, phonograph records and technological R. & D., it has 1) a quartet of companies that make drums, banjos, electric guitars, violin strings and other musical gear, 2) a pair of small Los Angeles producers of educational films, 3) Creative Playthings, a Princeton, N.J. maker of instructional toys and 4) the New York Yankees, who have been teaching the first baseman's trade to their brawny but brittle superstar, ex-Outfielder Mickey Mantle, in order to preserve his ailing legs--and possibly get out of last place next season.

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