ViacomCBS announced Tuesday a $2.175 billion cash deal to sell its Simon & Schuster book publishing company to Penguin Random House.
The acquisition, which would combine the No. 1 and No. 3 U.S. book publishers, is expected to close in 2021 pending regulatory approval.
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.
HarperCollins, a division of the Rupert Murdoch-owned News Corp, and the French media giant Vivendi were also in the running to buy Simon & Schuster, per the reports.
Simon & Schuster, which has more than 30 publishing units, has a stable of best-selling authors that includes Stephen King, Doris Kearns Goodwin and Jason Reynolds and a profitable backlist of beloved hits like “Catch-22” and “The 7 Habits of Highly Effective People.”
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.
ViacomCBS has faced financial challenges since re-combining in 2019 — problems that have been exacerbated this year by the coronavirus pandemic.