A judge in the United States has banned the $2.2 billion (£1.9 billion) merger between the world’s largest book publisher, Penguin Random House, and its rival, Simon & Schuster.
US District Judge Florence Pan stated in a brief decision on Monday that the merger could “substantially” reduce competition in the publishing business.
In November, the US Department of Justice filed a lawsuit to halt the transaction.
In 2013, Penguin Random House was founded by the merging of two large British and American publishers.
In her two-page judgment, Judge Pan stated, “The court finds that the United States has demonstrated that the proposed combination may substantially reduce competition in the market for US publication rights to expected best-selling novels.
Penguin stated in a statement that it will appeal the ruling, describing it as “a regrettable setback for readers and authors.”
Penguin has collaborated with such renowned authors as Sylvia Plath, George Orwell, Leo Tolstoy, and Virginia Woolf.
Recent publications include works by Zadie Smith, Marian Keyes, and Dan Brown.
Stephen King, Jennifer Weiner, and former presidential candidate Hillary Clinton are among the authors whose works have been published by Simon & Schuster.
During an August trial, the US government asserted that Penguin and Simon & Schuster would control roughly half of the market for publishing rights to best-selling books.
Readers and authors will receive “enormous benefits” from the merger, according to Penguin’s attorney Daniel Petrocelli, because the two publishing houses would continue to compete with one another even after the merger.
Stephen King, a best-selling horror author, refuted the claim.
“You might as well say a husband and wife will be bidding against each other for the same house. It is somewhat ludicrous “He stated in court.
US Assistant Attorney General Jonathan Kanter said in a statement that the proposed merger would have lowered competition, decreased author pay, limited the breadth, depth, and variety of our stories and ideas, and ultimately impoverished our democracy.
This comes as the Biden administration increases its oversight of anti-competitive practices.
Allen Lane, along with his brothers Richard and John, founded the British publishing company Penguin Books in 1935.
Its striking emblem has appeared on some of the most prominent books in the history of publishing.
The release of DH Lawrence’s Lady Chatterley’s Lover in 1960 and The Satanic Verses by Salman Rushdie in 1988 caused enormous issues.
In 2013, Penguin and Random Firm of New York united to form the world’s largest publishing house.
The European Commission stated at the time that the merged company would not raise competition issues because it would “meet multiple formidable competitors.”
Bertelsmann, the German parent company of Random House, controls 53% of Penguin Random House, while Pearson owns 47%.
