2023-08-08 13:12:49
The American publishing house Simon & Schuster changed shareholders on Monday August 7, and with it an impressive list of successful authors such as Stephen King, John Irving, Dan Brown and Annie Proulx. Scalded by a first attempt at a sale blocked by the courts, the Paramount Global group played it safe by selling its publishing group, the fourth on the American market, to the investment fund KKR. A definitive agreement has been concluded for an amount of 1.62 billion dollars (1.48 billion euros) which will be paid entirely in “cash”, specifies Simon & Schuster.
The sum is much lower than that which had been proposed during his failed marriage with his rival Penguin Random House (PRH), number one American publisher and subsidiary of the German Bertelsmann. The two competitors had topped for $ 2.2 billion in November 2020, but the administration of Joe Biden, increasingly vigilant regarding the potential harm of the mergers, had opposed such a union. A large-scale trial had kept everyone from publishing across the Atlantic in suspense, the pleadings having followed one another for three weeks in August 2022 in the court of the district of Washington.
Federal judge Florence Pan had finally blocked this merger on October 31, 2022, believing that the juggernaut resulting from such an operation risked reducing the number of works published and leading to less payment for authors. In its judgement, it feared that the takeover of Simon & Schuster by PRH would have “the effect of significantly weakening competition in the bestseller market”. Bad financial deal for the Bertelsmann subsidiary: PRH had to pay 200 million dollars to the owner of Simon & Schuster, which was provided for in one of the clauses of the contract since the purchase had not been concluded.
Several investors in the ranks
The lesson bore. It is therefore to avoid any problem of competition that the CEO of Paramount, Bob Bakish, has this time chosen a solution which seems easier by selling to one of the largest investment funds on the planet and not to one of the “Big Five”, the name given to the five largest publishing groups across the Atlantic (which include, in addition to PHR and Simon & Schuster, Hachette Book Group, HarperCollins and Macmillan).
According to Wall Street Journal from Friday August 4, the investor Richard Hurowitz was also in the running for this acquisition, supported by the sovereign fund of Abu Dhabi Mubadala Investment Company. Arnaud Lagardère – at the head of the group of the same name, parent company of Hachette Book Group, the American subsidiary of the French group – had assured, at the end of October 2022, that he would be in the ranks if one day Simon & Schuster was once more for sale. It appears that no offers have been submitted. The same causes producing the same effects, he would probably also have been challenged by American justice.
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