Paramount pulls offer to sell Simon & Schuster to Penguin Random House: How far will New York Times and Time magazine go to help?
PARAMOUNT PICTURES and Simon & Schuster are teaming up to buy publisher Simon & Schuster for $3 per share, about $1.1 billion dollars, in cash and stock, the papers said yesterday. The $3 is about what the papers valued the company at last year at $3.50 each, or around $1.1 billion.
While the terms of the deal have been in the works for months, the $1.1 billion price tag for Simon & Schuster, which includes some debt, sets the stage for a public battle over its future direction. The papers will be hoping that the deal is a sign that they can make it big in the world of publishing without selling the whole company.
The $3 price tag for the company would be the highest price ever paid for an American publisher, the New York Times reported, although it was said to be more than double the $1.3 billion paid for HarperCollins at the end of 2007.
Penguin, a New York based holding firm, will own the company’s books, film and media assets, the papers said, though the exact nature of those assets will remain unclear. The papers said that Simon & Schuster, which has been a publishing house since the 1950s, will have “significant presence in the digital realm.” Simon & Schuster has been experimenting with the publishing side of the company, including a joint venture with Disney as well as a deal with Simon & Schuster’s sister company, HarperCollins, to publish its latest books in the U.S.
The company, headquartered in the Times Building in Manhattan, has a staff of around 1,100, according to Reuters.
The New York Times reported that Simon & Schuster’s publishing arm will be run by Stephen Kaplan, an executive vice president overseeing the company’s book and film business. Mr. Kaplan will succeed Michael Buckley, who was made president and chairman. Another executive, Michael Biesecker, will be chairman.
Mr. Kaplan will be responsible for “all of the day-to-day management,” the New York Times reported.
Simon & Schuster’s publishing operation is