Penguin Random House acquires Simon & Schuster for 1.8 billion euros

Random House headquarters in London in 2012 LEON NEAL / AFP

The

is how the greats of the publishing sector are known in the United States.

But from now on we should talk about the

: Penguin Random House (PRH) has bought Simon & Schuster for 2,174 million dollars (about 1,800 million euros), as announced this Wednesday by the German group Bertelsmann, to which PRH belongs.

Or what is the same: the first North American publishing group has absorbed the third, in a bid in which it has managed to dismount the second, HarperCollins, a subsidiary of Rupert Murdoch's News Corporation.

Or what is the same: the editors of the successful memoirs of the Obamas or John Grisham have stayed with those who publish in the US Stephen King, John Irving or the latest anti-Trump political bombings of Bob Woodward and John Bolton.

The spectacular figure, much higher than the forecasts of the analysts of an always austere sector, reflects the scale of the battle that has been fought since the ViacomCBS conglomerate, owner of Simon & Schuster, announced earlier this year that it wanted to shed its editorial line to reduce debt and focus on its business by investing in the Eldorado of

.

And it is that there will hardly be another opportunity to buy a company from the big five so far, a select group that is completed by Hachette and Macmillan, both in powerful conglomerates.

HarperCollins was bidding so that the sum of its turnover (about 923 million euros) and that of Simon & Schuster (683 million euros) would leave it a few centimeters from the leadership of PRH (1,846 million euros) in the US market.

The leading North American group did not want to take risks and the result is that the sale of the historic Simon & Schuster (created in 1924) has become the largest acquisition in the commercial edition in the US since, precisely, HarperCollins paid six years ago 382 million euros for the Harlequin group, specialized in romantic literature.

The French multimedia conglomerate Vivendi (which bought back the Editis publishing group from the Spanish Planeta two years ago) had also appeared in the greedy bid, which saw in the operation a magnificent opportunity to enter through the front door of the US edition.

The acquisition will be ratified in the second half of next year, after being sanctioned by the US competition authorities, who will analyze a situation that implies that PHR and Simon & Schuster have almost 20% of the book market share in the US and PRH goes on to bill almost triple that of its second great competitor.

In the most literary field, PRH incorporates with Simon & Schuster, in addition to a staff of about 1,400 workers, about two thousand titles per year from the work of 35 publishing labels, which only two years ago provided 28 titles that were number one in the prestigious

.

And what is more important: a catalog of 35,000 works, potential content with which to feed the omnivorous audiovisual sector, from audiobooks to series for platforms or movie scripts, two of the new and great veins in the sector.

The acquisition of Simon & Schuster only reinforces the firm commitment of PRH and its parent company Bertelsmann to consolidate their dominance in the field of book publishing not only in the North American market but also worldwide.

In this vein, the complete acquisition, last April, of the last stakes that the English group Pearson had in PRH after the merger that began in 2013 would be framed. And the contribution that Simon & Schuster will make there, which also has a presence in Canada , UK (9th best-selling group), Australia and India, where PRH is also investing in recent years as one of the last major pockets of potential English language readers.

To the resentment of other links in the book chain (mostly authors and translators) given the concentration of supply that the purchase of Simon & Schuster entails, Bertelsmann further strengthens its fourth position in the ranking of the largest publishing houses in the world, only surpassed by editorial conglomerates of technical, scientific or educational books.

Without adding those of this last operation, PRH already embraces some 320 publishing houses (43 of them in the Spanish language field, from Penguin Random House Grupo Editorial), which produce some 15,000 books a year and which sell in more than a hundred of countries.

With Simon & Schuster he will thus widen the gap with Hachette (sixth in the world) and HarperCollins herself (ninth).

Simon & Schuster was the 27th.

The crisis generated by the pandemic and the high figure finally paid by PHR in the operation make analysts think that 2021 will be a year of acquisitions and mergers in the sector. As soon as possible, and within the US market, it is not ruled out that HarperCollins was

with the purchase of the Houghton Mifflin Harcourt label's bookstore division, which has a renowned educational book area, which explains why it is the 15th largest publishing group powerful of the world. The investment would be

about 319 million euros. And so the struggle between the only

.