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Penguin Random House is one of the longest-running and best-known book publishers in the United States, operating for decades in the business.
It originally planned to merge with Simon & Schuster, but parent-company Paramount recently canceled the deal.
Paramount also opted not to appeal a recent federal court decision blocking the publisher merger.
The news
Penguin Random House is a subsidiary of Bertelsmann, the German media giant.
Penguin must pay the parent company of Simon & Schuster a $200 million fine, according to a Paramount SEC filing.
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 the industry.
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 in a statement that it is still looking for buyers.
“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, Jonathan Karp, president and CEO of Simon & Schuster, 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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The lawsuit
According to the lawsuit, the settlement would have given the merged company more control over its authors’ compensation.
Penguin Random House and Simon & Schuster are currently among the leading book publishers in the United States and the “Big Five.”
Additionally, the lawsuit argues that there would be fewer bidders available for the highly anticipated books.
The fewer the bidders, the greater the potential blow for authors trying to publish their work.
Reference:
Penguin Random House’s $2.2 billion deal for Simon & Schuster is over
