US PUBLISHER Houghton Mifflin Harcourt, a unit of Barry O'Callaghan's heavily-indebted Education Media and Publishing empire, has temporarily stopped acquiring new books for publication by its consumer division.
The move by Houghton Mifflin, in business since 1832 and one of the most venerable and respected publishers in the American literary scene, has surprised some industry observers in the US. The publisher's current stable of internationally-renowned writers includes novelists Philip Roth and Gunter Grass.
The development follows a decision by Education Media to reduce the allocation of capital to its consumer books unit, from which the company generates 5.5 per cent of its revenues. Company president Jeremy Dickens told the New York Times that it has $7 billion in outstanding debt and was generating enough cash to "comfortably" meet annual debt service payments of $500 million.
The firm's education textbook unit is not affected by the freeze, which comes amid a slowdown in book sales in the US market.
A Dublin spokeswoman for the company said the stoppage on the acquisition of new manuscripts was "only temporary" and "not a total freeze".
"They are still accepting some manuscripts but they are taking a much more stringent look now before any manuscript is accepted."
Houghton Mifflin was controlled by private equity groups Thomas H Lee, Bain Capital and Blackstone before it was acquired in 2006 by Mr O'Callaghan's education software business Riverdeep, now known as Education Media and Publishing.
The $4.95 billion reverse takeover, backed by clients of stockbroking firm Davy, was the second largest transaction by an Irish company. The enlarged business acquired Reed Elsevier's consumer books division Harcourt last year in a $4 billion deal, the fourth largest transaction by an Irish firm.
While Education Media has inquiries from publishers interested in acquiring Houghton Mifflin Harcourt, the spokeswoman said the unit was not for sale.
