SIMON & SCHUSTER SOLD TO PRIVATE EQUITY FIRM FOR $1.62BN
Simon & Schuster, one of the leading English language book publishers globally, has been sold to private equity firm KKR for $1.62bn. This comes after a previous takeover attempt by rival Penguin Random House was blocked by a US judge. The deal is subject to regulatory approval, but it is expected to go through without any objections.
Simon & Schuster boasts a diverse portfolio of writers, including renowned horror author Stephen King and journalist Bob Woodward. The publisher is also gearing up for the release of highly anticipated books such as Britney Spears’ memoir “The Woman In Me” and Walter Isaacson’s biography of Elon Musk later this year.
In November 2020, Penguin Random House, owned by German media giant Bertelsmann, announced its intention to acquire Simon & Schuster for £1.9bn. However, the deal was blocked by US federal judge Florence Pan in October 2022. The judge ruled that the consolidation of the industry would result in less competition for big-selling books, ultimately impacting authors’ earnings. The US Department of Justice had also filed a lawsuit in 2021 to halt the takeover.
Despite the setback, Simon & Schuster’s parent company, Paramount, continued to search for a buyer. The proceeds from the sale will be used to pay off debt. Simon & Schuster CEO Jonathan Karp expressed his delight at the acquisition, assuring that the company would remain independent and thrive under KKR’s ownership.
Richard Sarnoff, chair of media at KKR, emphasized that editorial independence would be protected, stating, “We’re not going to tell them what to buy, what to publish or what not to publish. There’s a 99-year legacy of editorial independence that we’re going to protect.”
Simon & Schuster, which will celebrate its centenary next year, has reported strong sales in recent years. KKR has no plans for job cuts and instead aims to expand the publisher’s international reach. While KKR may run Simon & Schuster for five to seven years before considering a sale, no firm timeline has been established yet.
Overall, the sale of Simon & Schuster to KKR marks a significant development in the publishing industry. With the assurance of continued independence and the backing of a private equity firm, the publisher is poised for further growth and success.