Bertelsmann’s S&S merger faces scrutiny in US, UK
In the US, the Department of Justice (DoJ) has made a ‘second request’ for information as it reviews the transaction for its competitive implications.
The move comes after the Authors Guild urged the DoJ to ‘challenge PRH’s purchase of S&S and refuse to allow even further consolidation of the US book publishing industry’. According to the Guardian, the Authors Guild believes the combined PRH/S&S would account for approximately 35% of all book units sold in the US, while Bertelsmann argues that it would be less than 20%.
A PRH spokesperson told the Bookseller: ‘We are continuing to cooperate with the DoJ and continue to expect a closing during 2021.’
Meanwhile, the UK’s Competition and Markets Authority (CMA) has launched a merger investigation into the transaction, which would see S&S managed as a separate publishing unit under the PRH umbrella.
The CMA said it would examine whether the deal fell under the merger provisions of the Enterprise Act 2002 and whether it ‘may be expected to result in a substantial lessening of competition within any market or markets in the United Kingdom for goods or services’. The CMA will announce its decision on whether to refer the merger for a further investigation by 19 May.
The UK’s Society of Authors has previously urged the CMA to look at the deal, arguing it could have ‘a generally anti-competitive effect on prices for consumers and significantly adverse contractual terms for authors’.
A PRH UK spokesperson said the publisher is working with the CMA in its review. Bertelsmann said it still expected the deal to close in 2021, pending regulatory approvals.
In May last year, a planned merger between Cengage and McGraw Hill was called off after opposition from the DoJ and the CMA.
Category: International news