Private equity firm KKR is purchasing Simon & Schuster for $1.62 billion. Paramount had previously attempted to sell Simon & Schuster to Penguin Random House but the deal was stopped by the government due to antistrust concerns.

KKR might most be known for their acquisition of RJR Nabisco which was chronicled in the book Barbarian at the Gates, which became both a film and television series.

They have their hands in a wide range of industries which includes RBMedia, one of the largest publishers and distributors of audiobooks, OneDrive, Inc., a major distributor of eBooks to libraries. KKR agreed to sell RBMedia last month for a substantially higer price.

Jon Karp will remain chief executive of Simon & Schuster. Richard Sarnoff, the cahir of KKR’s media group, has worked in multiple positions in publishing including with Bertelsmann, the company that owns Punguin Random House. He’s also served as chairman of the Association of American Publishers, a trade group.

While KKR is already in the publishing business, it’s further consolidation in the book industry and private equity firms are known for slashing positions and tightening the screws in a negative way to increase profits. Simon & Schuster employees will receive an ownership stake in the company as part of a program KKR has developed and used before.

It’s unknown if this deal will also see regulatory scrutiny. It is believed part of the reason KKR’s offer was accepted is due to the fact it is less likely to be scrutinized. Also unknown is how the deal will be financed by KKR which will help determine Simon & Schuster’s future.

Simon & Schuster comic/graphic novel imprints include Atheneum, Simon & Schuster Books for Young Readers, Aladdin, Gallery 13, and more.

Simon & Schuster will celebrate its 100th anniversary in 2024.

(via New York Times)