BOOKS, COOKED

Penguin Random House’s $2.2B Deal to Buy Simon & Schuster Is Dead

The publisher is obligated to pay Paramount, Simon & Schuster’s parent company, a $200 million termination fee.

Paramount has scrapped an agreement to sell publishing house Simon & Schuster to Penguin Random House, the world’s largest book publisher, with the company saying in a federal filing on Monday that it would not appeal a recent court decision to block the merger on antitrust grounds. The dissolution of the proposed $2.18 billion deal comes two years after it was first announced, but less than a month after U.S. District Judge Florence Pan ruled that it would serve to “substantially… lessen competition in the market,” agreeing that the acquisition had the potential to harm authors’ earnings and the variety of books published in the United States. Penguin, a subsidiary of the German media group Bertelsmann, initially said it planned to appeal Pan’s order. On Sunday, Reuters reported that the deal was on the verge of collapse, with Bertelsmann having failed to convince Paramount to back the appeal process. Under the terms of the original deal, Bertelsmann is now obligated to pay Paramount a $200 million termination fee. A Penguin spokeswoman confirmed to The Wall Street Journal that the German group would make the payment.