Publishing industry: USA sue Bertelsmann subsidiary |

Status: 03.11.2021 10:04 a.m.

The US Department of Justice has filed an antitrust lawsuit against Bertelsmann subsidiary Penguin Random House. The reason is the takeover plans for the book publisher Simon & Schuster.

The government in Washington wants to prevent the multi-billion dollar purchase of the US book publisher Simon & Schuster by Bertelsmann subsidiary Penguin Random House. To this end, the US Department of Justice filed an antitrust lawsuit against the New York-based publisher.

In support, Attorney General Merrick Garland said that if the world’s largest book publisher was allowed to acquire one of its key competitors, it would gain unprecedented control over the publishing industry. In any case, there are only five major book publishers in the US, Simon & Schuster is number four: “American authors and consumers would pay the price for this anti-competitive merger – lower advance payments for authors and ultimately fewer books and less variety for consumers.”

Acquisition for $ 2.18 billion

Bertelsmann is one of the world’s largest media groups. The board of directors had already announced the planned takeover for 2.18 billion dollars in November 2020, so far Simon & Schuster belongs to the US media group ViacomCBS. With the acquisition, the Gütersloh-based group wants to strengthen the subsidiary’s presence in the USA. At that time, boss Thomas Rabe spoke of a “further strategic milestone to strengthen our global content businesses”.

With the takeover, important authors will be gained: Among others, the US publisher Simon & Schuster publishes books by star author Stephen King, Pulitzer Prize winner Anthony Doerr and journalist Bob Woodward, but also by former US Secretary of State Hillary Clinton.

Publishers want to defend themselves against lawsuits

The Justice Department criticizes that the planned purchase would give Penguin Random House almost half of the market for the publication rights to blockbuster books. The closest competitor is less than half that size.

Penguin Random House and Simon & Schuster rejected the Justice Department’s objections in a statement to the US media and announced that they would vigorously defend themselves against the lawsuit. When he announced the purchase last year, CEO Rabe said he was confident that the authorities would approve the project. Penguin Random House and Simon & Schuster would only have a combined share of sales of less than 20 percent in the USA. The market share of the two publishers is thus below a worrying level.

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