KKR preps sale of audiobook publisher RBMedia, sources say

KKR is eyeing a sale of its portfolio company RBMedia, a publisher of audio books, for up to $2 billion, sources told PE Hub.

The process is not yet live, and it’s not clear when the asset could hit the market. Advisers have not yet been signed up for the deal.

A spokesperson for KKR declined to comment

The company, based in Landover, Maryland, was producing EBITDA in the range of $100 million to $125 million, one of the sources said. A $2 billion sale would represent the high end of what the company could trade for. “That’s high but it could get that,” the source said.

KKR acquired RBMedia in 2018 from Shamrock Capital, which had been invested in the business since 2015. In 2020, KKR-backed OverDrive, a digital library platform, acquired the library assets of RBMedia, the company said.

Earlier this year, the company added on Ukemi Audiobooks – which since 2015 had produced previously unreleased fiction and nonfiction classics – and Dharma Audiobooks, which publishes Buddhist recordings, including biographies, histories and classic literature, the company said in a statement.

Other add-ons under KKR’s ownership included the bolt-on of German audiobook publisher ABOD in 2022. In 2021, add-ons included European audiobook company Booka; McGraw-Hill Professionals audiobook business; and Author’s Republic, an audiobook self-publisher.

The global spoken audio market has grown steadily over the past few years, RBMedia said on its website. It expects growth from about $7.9 billion last year to $9.5 billion this year, though market turmoil from the bank crisis could impact that estimate.

Overall, private equity buyout and exit activity has slowed since last year. The industry is well-stocked with fresh capital ready for deals, but firms are being more selective on the assets they chase because the cost of debt is increasing as the Federal Reserve raises interest rates to control inflation.

The total value of global M&A deals last year fell 37 percent from a record high in 2021 to $3.61 trillion, according to a recent Reuters report of Refinitiv data. That is the biggest year-over-year percentage drop since 2001 when the US economy fell into recession.

Through mid-March, global dealmaking dropped nearly 50 percent in terms of total deal value from a year ago, and is off nearly 30 percent in deal volume, the report said.