The Penguin logo is seen on the spines of books displayed on a shelf at Book Passage on November 2, 2021 in Corte Madera, California. The US Justice Department is suing Penguin Random House and Simon & Schuster to prevent the companies from completing a $2.175 billion merger.
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Paramount Global on Monday said it canceled a $2.2 billion deal to sell book publisher Simon & Schuster to rival Penguin Random House, weeks after a federal judge rejected the merger.
Penguin, owned by German media conglomerate Bertelsmann, said it still believes Simon & Schuster is right for its business and has accepted Paramount’s decision.
“We believe the judge’s decision is wrong and planned to appeal this decision, confident that we can make a strong and compelling case to overturn the lower court’s decision on appeal,” Penguin said in a statement Monday afternoon. “However, we must accept Paramount’s decision not to move forward.”
In a statement Monday, Paramount said it would continue to seek to get rid of Simon & Schuster.
“Simon & Schuster is a very valuable business with recent strong performance,” Paramount said. “However, it is not based on video and therefore does not fit strategically into Paramount’s broader portfolio.”
Read the full release here:
Paramount Global (f/k/a ViacomCBS Inc.) (“Paramount”) announced that it and certain of its subsidiaries have entered into a share purchase agreement (the “Purchase Agreement”) to sell the Simon & Schuster business to Penguin Random House. LLC (part of the Bertelsmann SE & Co. KGaA group, “Penguin Random House”), subject to certain customary conditions, including obtaining appropriate regulatory approvals (the “Sale”).
On November 2, 2021, the United States Department of Justice (“DOJ”) filed suit in the United States District Court for the District of Columbia to block the sale, and on October 31, 2022, the court ruled in favor of the DOJ. sale order (the “Decision”). Following the Resolution on November 21, 2022, Paramount terminated the Purchase Agreement in accordance with its terms. Penguin Random House is required to pay a $200 million termination fee to Paramount. Simon & Schuster remains a non-core asset of Paramount, as determined in early 2020 when Paramount conducted a strategic review of its assets.
Simon & Schuster is a very valuable business with recent strong performance; however, it is not based on video and therefore does not fit strategically into Paramount’s broader portfolio.
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