April 10 (Bloomberg) -- Bertelsmann AG agreed to buy Time Warner Inc.'s stake in Bookspan, giving the company full ownership of Book of the Month Club and making it the biggest operator of book, music and DVD clubs in the U.S.

Bertelsmann agreed to pay about $150 million for the stake, according to three people familiar with the matter. Bookspan, a 50-50 venture of the largest media companies in the U.S. and Europe, will be fully owned by Bertelsmann after the purchase, the Guetersloh, Germany-based company said in a statement today.

The club business will serve more than 20 million members in the U.S. through its catalogs and the Internet after the Bookspan purchase, Bertelsmann said. Closely held Bertelsmann bought DVD seller Columbia House Co. in 2005 to merge it with its U.S. music club BMG Direct.

Stuart Goldfarb, who heads the BMG Columbia House unit, will lead the enlarged entity. Combining Bookspan brands such as Book of the Month Club, Doubleday Book Club and Literary Guild with Bertelsmann's existing music and DVD businesses will help the company increase sales, Goldfarb said in the statement.

Bertelsmann spokesman Klaus Markus and Time Inc. spokeswoman Dawn Bridges declined to give financial details of the deal.

Asset Sales

Magazine publisher Time Inc., a division of New York-based Time Warner, has been disposing of assets and shutting down titles to cut expenses as sales stagnate. In January, Time sold 18 magazines to Swedish publisher Bonnier. Time said in March it plans to close Life magazine this month.

Ann Moore, chief executive officer of Time, said in the statement that Bookspan deal ``reinforces Time Inc.'s commitment to the brands and projects that will be central to our long-term success,'' and the business will be a ``good strategic fit'' for Bertelsmann.

Combining Bookspan and Columbia will help Bertelsmann to ``achieve operational efficiencies through the combination of complementary businesses,'' said Ewald Walgenbach, head of Bertelsmann's DirectGroup unit.

Bertelsmann, which already operates the world's largest set of book clubs, is trying to connect its book clubs and book retail businesses more closely to improve profitability. At its book club business, Bertelsmann offers discounts on books for its members, who are required to buy books on a regular basis.

In 2006, the company agreed to buy Portuguese publisher and book retailer Livraria Bertrand and in 2005 Bertelsmann bought two bookstore chains in France.

To contact the reporter on this story: Simon Thiel in Munich at sthiel1@bloomberg.net

Last Updated: April 10, 2007 11:07 EDT