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US govt won't stop Random House, Penguin deal
Thursday - 2/14/2013, 7:41pm EST
WASHINGTON (AP) -- The Justice Department has closed an investigation of a proposed merger between Penguin and Random House and will take no action to stop the deal that would create the world's largest publisher of consumer books.
Media company Pearson seeks to merge its Penguin Books division with Random House, which is owned by German media company Bertelsmann. The proposed publishing house would have around a quarter of the consumer book market.
Word of the U.S. government's decision came from the companies, and Justice Department spokeswoman Gina Talamona confirmed it on Thursday.
Bertelsmann will own 53 percent and Pearson 47 percent of shares in the proposed publishing house, which will encompass all of Random House and Penguin Group's publishing units in the U.S. and six other countries.
Among other regulators reviewing the proposed arrangement are the Canadian Competition Bureau and the European Commission. Bertelsmann and Pearson said they expect all antitrust approvals needed to finalize the merger will be completed in the second half of this year.
"This positive first decision by one of the antitrust authorities is an important milestone on the path to uniting two of the world's leading publishing companies into a truly global publishing group," Bertelsmann Chairman and CEO Thomas Rabe said.
Besides the U.S., the proposed merger includes Random House and Penguin Group's publishing units in Canada, the United Kingdom, Australia, New Zealand, India and South Africa. Penguin's operations in China and Random House's publishers in Spain and Latin America also are part of the proposed merger.
The combined company will control 26 percent of the global consumer publishing market, leaping ahead of the 17 percent share of French publisher Lagardere, according to research by Espirito Santo Bank.
Copyright 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.