NewsCorp CEO Robert Thomson, whose company owns book publisher HarperCollins, on Wednesday slammed the "anti-market logic" of the nation's largest book publisher acquiring rival Simon & Schuster.
Earlier, ViacomCBS confirmed that German media giant Bertelsmann's Penguin Random House had won a heated auction for Simon & Schuster with a $2.175 billion cash deal. HarperCollins, the nation's No. 2 book publisher, had also bid for the company.
"There is clearly no market logic to a bid of that size -- only anti-market logic," Thomson said in a statement. "Bertelsmann is not just buying a book publisher, but buying market dominance as a book behemoth. Distributors, retailers, authors and readers would be paying for this proposed deal for a very long time to come. This literary leviathan would have 70 percent of the US Literary and General Fiction market."
Thomson concluded by throwing a bit of shade. "There will certainly be legal books written about this deal, though I wonder if Bertelsmann would publish them," he said.
The acquisition, which would combine the No. 1 and No. 3 U.S. book publishers, is expected to close in 2021 pending regulatory approval -- and Thomson clearly thinks that regulators should be raising antitrust concerns about the deal.
Penguin Random House, a division of the German media giant Bertelsmann, will continue to be managed as a separate publishing unit with current President and CEO Jonathan Karp and COO/CFO Dennis Eulau continuing as its top executives.
Bob Bakish said during an investor conference in March that ViacomCBS was look to offload Simon & Schuster.
"We'll engage in a process and look at strategic alternatives for Simon & Schuster," the ViacomCBS CEO said during the Morgan Stanley Technology, Media and Telecom Conference in San Francisco. He added that the publishing unit "is not a core asset. It is not video-based. It does not have significant connection for our broader business."
The publishing company founded in 1924 by Richard Simon and M. Lincoln Schuster. Viacom acquired Simon & Schuster in 1994 as part of its acquisition of Paramount Communications. It went with CBS Corp. after Sumner Redstone split the two companies in 2006.