Paramount completes $1.62 billion sale of Simon & Schuster to investment firm KKR

Paramount has completed the $1.62 billion sale of book publisher Simon & Schuster to investment firm KKR, nearly a year after a richer sale to Penguin Random House fell through due to regulatory issues.

The cash deal announced last August makes Simon & Schuster an independent private company and the only independent major specialist publisher. Last year, a judge in an antitrust case ruled against a pending $2.2 billion takeover by a direct competitor, citing monopoly concerns and potential negative impact on customers and other publishers. The deal was then officially abandoned last November, and Bertelsmann’s Penguin Random House paid a $200 million breakup fee to Paramount.

Simon & Schuster CEO Jonathan Karp will continue to lead the company, which was founded in 1924.

Paramount, like its major media rivals, faces a challenging operating environment in linear television and motion pictures as it struggles to achieve profitability in the highly competitive streaming market. After rebranding following the Viacom-CBS merger in 2019, Paramount recently began cutting costs and reducing debt. The company held discussions with potential buyers of a stake in BET before ultimately ending those discussions.

“After an arduous process, this is an ideal outcome for both Simon & Schuster and Paramount,” Paramount CEO Bob Bakish said in a press release. “Simon & Schuster is well positioned for future growth and the transaction itself represents significant value creation for Paramount and significantly advances our resolution plan. We are honored to have Simon & Schuster as part of our Paramount family for nearly 50 years, and we wish Jon and the entire team continued success in their new chapter at KKR.”

Karp described the deal as “an exciting moment for us — both a return to our roots as an independent company and an opportunity for all of us to forge a new path together.” KKR’s resources will help “turn the publisher into one and even stronger”. company and a more dynamic force in our industry,” he added.

“The company is in a strong position to capitalize on the opportunities ahead, and we look forward to building on Simon & Schuster’s reputation for delivering engaging and engaging books to readers around the world,” says Ted Oberwager, Partner at KKR and Head of Games. , entertainment, media and sports within the company’s US private equity business.