“Publish or perish” is a phrase well-known among researchers, and refers to the unabated pressure, and maybe even dread, academics feel to publish their work so as to leave an indelible mark in their respective fields.
Yet the phrase overlooks a fundamental factor: It greatly matters where a researcher publishes – the better the journal, the greater the prestige and the compounding benefit to their career trajectory. Among the most prestigious science publishers worldwide, there are very few as renowned as Nature, first published in London in 1869, or Scientific American, which debuted in New York back in 1845.
Today the Springer Nature group, a joint venture between BC Partner’s Springer Science and Business Media with Holtzbrinck’s Macmillan Science and Education in 2015, will make its anticipated debut on the Frankfurt Stock Exchange. (To be clear, this is not the same Springer as the Axel Springer group that publishes Bild, Germany’s highest-circulating newspaper.)
Headquartered in Berlin, Springer Nature’s co-owners, the Georg von Holtzbrinck Publishing Group, or HPG, a similarly named but separate entity to Handelsblatt’s parent, and private equity investor BC Partners, hope their IPO of 113 million shares will rake in up to €1.6 billion ($1.9 billion) to help pay off an estimated €3 billion in debt. Currently, HPG owns 53 percent of shares and BC partners 47 percent.
Ahead of the IPO, Reuters reported that investment bank Morgan Stanley anticipates shares will be priced at €10.50 a share, though the range was as high as €14.50. Demand for the stock has reportedly outstripped supply and it stands to be the second-largest IPO in Frankfurt so far this year, behind Siemens’ Healthineers and ahead of Deutsche Bank’s DWS.
HPG has said it will buy €200 million in new shares to show their long-term interest in Springer Nature, which generated €1.6 billion in revenue in 2017 and is worth an estimated €5.5 billion. The group publishes 2,800 journals, 240,000 e-books and 13,000 new books a year, almost all of them digital; two million readers visit its online platforms every day. After the IPO, HBG’s stake will be around 40 percent and BC Partners will stay in the picture as a major shareholder until 2020, able to sell up to 19 million shares.
Much within the group centers around putting “digital first,” said Daniel Ropers, the 46-year-old CEO at Springer Nature, during a road show to round up interest for the IPO.
Springer Nature, which also publishes Scientific America and the BioMed Central series, is diving into open access publishing, which reduces many financial and permission barriers for readers, letting them get their hands on those pricey, coveted scientific publications. It works by having authors pay close to €2,200 to have Springer Nature verify and index the studies. This area is growing at an annual rate of 3.2 percent and the group wants to expand the concept in Germany, especially after a surge of complaints.
After the IPO, even if debts shrink to €2 billion as expected, the publisher’s liabilities will still be 3.5 times higher than its internal income (EBITDA) of €521 million. Major competitors like Informa, which owns the British group Taylor & Francis, and publishing group Relx, formerly known as Reed Elsevier, are in better shape.
The group also reported €66 million in losses last year, due to write-offs and servicing of its hefty debt. But if the group’s flagship journal's reputation stays as clean and respected as it is now, there is little to worry about. “We have a company that is incredibly robust, even in times of crisis,” said Stefan von Holtzbrinck, HPG’s 55-year-old owner.
According to Mr. Ropers, the publishing company receives around a million articles submitted for publishing from scientists who apparently feel the publish-or-perish stress. Springer Nature takes about 300,000 of them. Seems the group doesn’t feel quite the same pressure.
Hans-Jürgen Jakobs is a senior editor at Handelsblatt and a former co-editor in chief, together with Sven Afhüppe. Christine Coester adapted this text into English for Handelsblatt Global. To contact the author: [email protected]