Paramount Global Terminates $2.2B Simon & Schuster Sale But Still Wants Out Of Publishing Biz

deadline.com:

A major publishing deal is officially dead in the water as Paramount Global scrapped its sale of Simon & Schuster to Bertelsmann’s Penguin Random House, declining to pursue an appeal after the Department of Justice sued to block the merger and a federal judge upheld the government’s position.

The sale was announced two years ago, in Nov. of 2020, as the former ViacomCBS was shedding non-core assets to raise cash and pay down debt.

President Biden’s more activist DOJ reviewed the deal and sued to block in Nov. of 2021, arguing the transaction would create a behemoth publisher likely to drive down payments to authors and “reduce quality, service, choice, and innovation.” The government claimed that the merger was “presumptively unlawful,” leaning heavily on the fact that it would combine the largest book publisher, Penguin Random House, with the fourth in the marketplace, Simon & Schuster, creating a corporation with twice the revenues of its next closest competitor.

The lawsuit focused on the impact of the deal on author payments, rather than on the traditional purview of antitrust, consumer prices.