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The Penguin emblem is seen on the spines of books displayed on a shelf at E book Passage on Nov. 2, 2021 in Corte Madera, California. The U.S. Division of Justice is suing Penguin Random Home and Simon & Schuster to dam the businesses from finishing a merger valued at $2.175 billion.
Justin Sullivan | Getty Pictures Information | Getty Pictures
Paramount Global stated Monday it scrapped its $2.2 billion deal to promote guide writer Simon & Schuster to rival Penguin Random Home, weeks after a federal decide rejected the merger.
Penguin, which is owned by German media conglomerate Bertelsmann, stated it nonetheless believes Simon & Schuster is an efficient match for its enterprise however that it accepted Paramount’s determination.
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“We consider the decide’s ruling is incorrect and deliberate to enchantment the choice, assured we might make a compelling and persuasive argument to reverse the decrease court docket ruling on enchantment,” Penguin stated in a press release Monday afternoon. “Nevertheless, we’ve to simply accept Paramount’s determination to not transfer ahead.”
Paramount’s determination to tug the plug on the deal got here greater than a yr after the Justice Division sued to dam the deal, saying it might damage competitors for books within the publishing world. On Halloween, after a trial that included testimony from bestselling horror creator Stephen King, U.S. District Courtroom Choose Florence Y. Pan dominated towards the deal, delivering a significant victory for the Biden administration’s antitrust agenda.
King, who writes books for Simon & Schuster, stated he was “delighted” by the ruling. “The proposed merger was by no means about readers and writers; it was about preserving (and rising) PRH’s market share. In different phrases: $$$,” he tweeted.
In its announcement Monday, Paramount stated Penguin is on the hook for a $200 million termination payment.
Paramount additionally indicated that it might nonetheless search to unload Simon & Schuster.
“Simon & Schuster is a extremely priceless enterprise with a latest document of sturdy efficiency,” Paramount stated. “Nevertheless, it isn’t video-based and due to this fact doesn’t match strategically inside Paramount’s broader portfolio.”
Learn Paramount’s full launch right here:
Paramount World (f/ok/a ViacomCBS Inc.) (“Paramount”) introduced that it and sure of its subsidiaries had entered right into a Share Buy Settlement (the “Buy Settlement”) to promote the Simon & Schuster enterprise to Penguin Random Home LLC (a part of the Bertelsmann SE & Co. KGaA group, “Penguin Random Home”), topic to the satisfaction of sure customary circumstances, together with receipt of relevant regulatory approvals (the “Sale”).
On November 2, 2021, the U.S. Division of Justice (the “DOJ”) filed go well with in america District Courtroom for the District of Columbia to dam the Sale and on October 31, 2022, the Courtroom dominated in favor of the DOJ, enjoining the Sale (the “Resolution”). Following the Resolution, on November 21, 2022, Paramount terminated the Buy Settlement in accordance with its phrases. Penguin Random Home is obligated to pay a $200 million termination payment to Paramount. Simon & Schuster stays a non-core asset to Paramount, as was decided in early 2020 when Paramount performed a strategic overview of its property.
Simon & Schuster is a extremely priceless enterprise with a latest document of sturdy efficiency; nonetheless, it isn’t video-based and due to this fact doesn’t match strategically inside Paramount’s broader portfolio.
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