Bertelsmann bid to buy Simon & Schuster secures CMA clearance

A blockbuster deal by Penguin Random House owner Bertelsmann to buy rival US book publisher Simon & Schuster today cleared a significant regulatory hurdle.

The backing of the Competition and Markets Authority (CMA) came despite the UK’s Society of Authors raising fears about the potential impact of the tie-up on prices for consumers and contractual terms for authors.

The CMA has not yet disclosed its rationale for clearing the $2.18 billion (£1.45 billion) acquisition by Penguin owner Bertelsmann.

Simon & Schuster is home to star authors including Stephen King and Dan Brown.

Penguin Random House publishes around 15,000 new books a year, with recent titles including the first part of former US President Barack Obama’s memoirs, “A Promised Land”.

In the US, the Department of Justice has come under pressure from the country’s National Writers Union to block the deal.

News Corp boss Robert Thomson has previously said the deal has “anti-market logic” and would create a “book behemoth”.

German media giant Bertelsmann, which took full control of Penguin Random House from Pearson in April 2020,  said the deal to buy Simon & Schuster from ViacomCBS would give it a US market share of less than 20%, and is therefore “approvable”.

Penguin Random House spokesperson: “We’re pleased that the Competition and Markets Authority has cleared Penguin Random House’s acquisition of Simon & Schuster in the UK.  The process in the US is ongoing and we are working constructively with the authorities there.”