Image source: Bloomberg
Penguin Random House is one of the oldest and best-known book publishers in the United States.
It initially planned to merge with Simon & Schuster, but Paramount recently canceled the deal.
Paramount also decided not to appeal the recent federal court decision blocking the publishers’ merger.
Penguin Random House is a subsidiary of German media giant Bertelsmann.
According to a Paramount SEC filing, Penguin is required to pay the parent company of Simon & Schuster a $200 million penalty.
The $2.17 billion proposal was announced in November 2020.
Last month, US District Court Judge Florence Pan ruled that merging the book publishers would unlawfully restrict competition.
In 2021, the Justice Department filed a lawsuit to block the merger, one of the Biden administration’s first significant antitrust actions.
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Simon & Schuster
The parent company of Simon & Schuster says that it is still looking for buyers in a statement.
“Simon & Schuster is a highly valuable business with a recent record of strong performance,” they wrote.
“However, it is not video-based and therefore does not fit strategically within Paramount’s broader portfolio.”
Meanwhile, Simon & Schuster President and CEO Jonathan Karp wrote an email saying the news was still fresh.
“And at this point, I have no specific information to impart about what will happen in the coming months,” said Karp.
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According to the lawsuit, the settlement would have given the merged company more control over how much its writers were compensated.
Penguin Random House and Simon & Schuster are currently among the prominent book publishers in the United States and members of the “Big Five.”
Additionally, the lawsuit argues that fewer bidders would be available for the highly anticipated books.
The lower the bidders, the greater the potential blow for authors seeking to have their work published.
Penguin Random House’s $2.2 billion deal for Simon & Schuster is over