“TOO LATE TO STAND UP AGAINST AMAZON”: BOOK-INDUSTRY INSIDERS BACK THE BIDEN ADMINISTRATION’S BID TO STOP A PUBLISHING MEGA-MERGER
The Department of Justice’s attempt to halt Penguin Random House’s acquisition of Simon & Schuster finds support within an industry already burned by bad trends. “Obviously every agent is thrilled that the wheels might be grinding to a halt on this,” one insider says.
BY JOE POMPEO
The news this week that the Biden administration is headed to court to stop Penguin Random House from acquiring Simon & Schuster added a new ripple of drama to the already feverish climate of media M&A. Biden’s Department of Justice, which is taking a more aggressive approach to corporate consolidation, says that the proposed $2.18 billion merger would give Penguin Random House, the world’s largest publisher, “unprecedented control” over the book-publishing industry, and that it would result in “lower advances for authors and ultimately fewer books and less variety for consumers.” PRH and S&S argue that the merger would not reduce “the number of books acquired” or the “amounts paid for those acquisitions,” and that the two publishing houses, both members of the so-called “Big Five,” would still be permitted to bid against each other in auctions “up to an advance level well in excess of $1 million.” PRH has its boxing gloves on: The company has retained Daniel Petrocelli, the same man who litigated AT&T and Time Warner’s successful battle with the Trump administration in 2018. (Pass the popcorn.)