Book publishing giant Simon & Schuster will be sold to private equity firm KKR in a deal worth $1.62 billion, owner Paramount Global announced Monday. Photo courtesy of Simon & Schuster
Aug. 7 (UPI) -- Paramount Global has agreed to sell book publishing giant Simon & Schuster to private equity firm KKR in an all-cash deal worth $1.62 billion.
Once the sale closes, Simon & Schuster will become a standalone private company as KKR vowed to advance "one of the world's best-known publishers and distributors with more than 36,000 titles across adult, children, audio and international categories."
"Today, we agreed to acquire Simon & Schuster from Paramount," KKR announced Monday in a post on X.
"Simon & Schuster's nearly 100-year history is a testament to the enduring value of creative expression through the written and spoken word."
KKR, which stands for Kohlberg Kravis Roberts, is a New York-based global investment firm. The company plans to finance its purchase of Simon & Schuster primarily through its North America Fund XIII.
"All of the executives at Simon & Schuster who met with KKR came away from those conversations impressed with the depth of KKR's interest in our business and their commitment to helping us grow, thrive and become an even stronger company," Jonathan Karp, president and chief executive officer of Simon & Schuster, said in a statement.
"With KKR's support, we look forward to collaborating on new strategies that will enhance our ability to provide readers a great array of books and to give authors the best possible publication they can receive," Karp added.
In the meantime, Paramount Global -- which owns Paramount Pictures, CBS, Showtime and other networks -- promised its shareholders that the sale will help the entertainment giant reduce its outstanding debt.
"We are pleased to have reached an agreement on a transaction that delivers excellent value to Paramount shareholders while also positioning Simon & Schuster for its next phase of growth with KKR," Bob Bakish, president and CEO of Paramount Global, said in a statement Monday.
"The proceeds will give Paramount additional financial flexibility and greater ability to create long-term value for shareholders, while also delevering our balance sheet," Bakish added.
Paramount posted Simon & Schuster for sale in 2020 and backed out of a deal last November, which would have merged the book publisher with Penguin Random House for more than $2 billion, after a judge ruled the deal violated antitrust laws.
Once the current transaction closes, KKR plans to support Simon & Schuster's more than 1,600 employees by creating a broad-based equity ownership program, according to Richard Sarnoff, chairman of media at KKR.
"We also believe the opportunity to create an ownership culture within one of the world's top publishers has enormous potential to create value for all of Simon & Schuster's stakeholders."