Nov. 1 (UPI) -- The parent company of Penguin Random House announced Tuesday that it plans to appeal a federal court's decision to block its proposed $2.2 billion acquisition of one of its main competitors, Simon & Schuster.
Bertelsmann, which is the German parent company of the multinational New York-based book publishing conglomerate, said it believes Judge Florence Y. Pan was wrong when she ruled Monday that the merger would violate antitrust laws.
"A merger would be good for competition," Bertelsmann chief executive Thomas Rabe said in a statement. "We remain convinced that Bertelsmann and Penguin Random House would be the best creative home for Simon & Schuster -- with a wide variety of publishers that could operate independently under one umbrella."
He said their motion for an expedited appeal will be filed with the D.C. court.
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The announcement came hours after the Justice Department said Pan of the U.S. District Court for the District of Columbia had ruled in its favor to block the merger.
The court had ruled that the effects of the acquisition would lessen competition in the market for U.S. publishing rights to anticipated top-selling books, federal prosecutors said.
"Today's decision protects vital competition for books and is a victory for authors, readers and the free exchange of ideas," Assistant Attorney General Jonathan Kanter of the Justice Department's Antitrust Division said in a statement.
"The proposed merger would have reduced competition, decreased author compensation, diminished the breadth, depth and diversity of our stories and ideas, and ultimately impoverished our democracy."
Kanter continued that the ruling is also a victory for workers as it reaffirms that antitrust laws protect competition.
The merger was announced in November 2020 with ViacomCBS agreeing to sell publisher Simon & Schuster to Penguin Random House for $2.175 billion.
A year later, the Justice Department sued, stating the deal would permit Penguin Random House to "exert outsized influence over which books are published in the United States and how much authors are paid for their work."
Best-selling author Stephen King testified on behalf of the Justice Department during the 13-day trial in August, saying the deal would kill competition over authors selling books as it would create an environment akin to a husband and a wife bidding against each other for a house.
"It's a bit ridiculous," he said.
On Monday, King tweeted he was "delighted" that Pan blocked the merger.
"The proposed merger was never about readers and writers: it was about preserving (and growing) PRH's market share," he said.
