Bertelsmann, parent to publisher Random House and Simon & Schuster

Bertelsmann Acquires Simon & Schuster

November 27, 2020
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Bertelsmann Strengthens Global Content Businesses with Acquisition of Simon & Schuster
• Penguin Random House buys global publisher for $2.175 billion
• Acquisition strengthens position in Group’s second-largest market, the U.S
• Simon & Schuster is the publishing home to well-known authors such as Hillary
Clinton, John Irving, Stephen King, and Bob Woodward
• Transaction expected to close during 2021

Gütersloh / New York, November 25, 2020 – Bertelsmann, the international media, services,
and education company, is further expanding its global content businesses with the
acquisition of the publishing house Simon & Schuster. Bertelsmann’s global trade book
publishing group, Penguin Random House, is purchasing the book publishing business from
the media company ViacomCBS for $2.175 billion.

Simon & Schuster strengthens Bertelsmann’s footprint globally, and particular in the U.S., its second-largest market. Simon & Schuster employs around 1,500 people worldwide and generated revenues of $814 million
in 2019. It publishes works from well-known authors and public figures including
Hillary Clinton, John Irving, Stephen King, and Bob Woodward. The transaction is subject to
regulatory approvals and is expected to close during 2021. Bertelsmann will pay the
purchase price in cash from existing liquid funds. Simon & Schuster will continue to be
managed as a separate publishing unit under the Penguin Random House umbrella.
Jonathan Karp, President & CEO of Simon & Schuster, and Dennis Eulau, COO and CFO,
will continue at the helm of the publishing house.

Thomas Rabe, Chairman & CEO of Bertelsmann, said: “Following the full acquisition of
Penguin Random House in April this year, this purchase marks another strategic milestone in
strengthening our global content businesses, which include Penguin Random House, the
Fremantle TV production business, and the BMG music division. The book business has
been part of Bertelsmann’s identity since the founding of C. Bertelsmann Verlag more than
185 years ago and has lost none of its appeal to this day. Bertelsmann continues to be one
of the world’s leading creative companies with annual investments in content of around
€6 billion.

“Bertelsmann will finance the acquisition of Simon & Schuster from existing cash resources.
External borrowing is not necessary, thanks partly to the overall positive business
development since the summer and the already completed sale of various businesses,
investments and real-estate properties.”

Markus Dohle, CEO Penguin Random House and a member of the Bertelsmann Executive
Board, added: “Simon & Schuster is an extremely well-managed and extraordinarily
attractive company with world-renowned authors, 2,000 new publications annually, and a
catalog of 35,000 titles. We are very proud to welcome this esteemed company, founded in
1924, to our global publishing community. We share the same passion for books and reading
and will work together to give our authors the greatest possible access to readers worldwide.
Penguin Random House empowers its 320 publishers around the world with maximum
creative and entrepreneurial freedom and will, of course, extend this to our new colleagues at
Simon & Schuster.”

Penguin Random House, comprising more than 320 imprints, employs approximately 10,000
people worldwide on six continents. The group publishes around 15,000 new books a year.
On November 17, 2020, the first part of former U.S. President Barack Obama’s memoirs, “A
Promised Land” was published to great success. The biggest-selling novel in the first half of
2020 was “Where the Crawdads Sing” by Delia Owens, which sold more than 1.6 million
copies; this brings overall sales of the title in North America alone to more than 6.5 million
copies across all formats since its publication in 2018. Michelle Obama’s memoir, published
in November 2018, has sold 15 million copies to date.

J.P. Morgan Securities LLC acted as financial advisor, Davis Polk & Wardwell LLP as legal
counsel and Arnold & Porter as regulatory counsel to Bertelsmann on the transaction.

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