ViacomCBS will sell its publishing wing, Simon & Schuster, to Bertelsmann, the company that owns Penguin Random House, combining two of the world’s largest publishers into a mega publisher that has the potential to reshape the industry, should it go through.

The deal, announced Wednesday, is worth more than $2 billion and set to go through in 2021 if it passes regulatory approval. It would merge the number one publisher in the United States with the third-largest, sparking antitrust concerns.

What You Need To Know

  • ViacomCBS will sell Simon & Schuster to Penguin Random House's parent company, Bertelsmann

  • The deal sparks antitrust concerns, since it combines the biggest and third-biggest publishers

  • ViacomCBS said the publishing company will remain independent and under the same leadership

  • The $2 billion deal is set to close in 2021

Simon & Schuster was put up for sale earlier this year, though book sales are at their highest in recent years due to the pandemic.

“This transaction is the outcome of a highly competitive auction that attracted interest from buyers around the world, reflecting Simon & Schuster’s position as one of the world’s best known publishing brands,” ViacomCBS said in a statement.

Penguin Random House chief executive Markus Dohle told The Associated Press on Wednesday that Simon & Schuster would retain its editorial independence and that individual imprints within Penguin Random House and Simon & Schuster could continue to compete with each other for book deals.

“Simon & Schuster strengthens Bertelsmann’s footprint globally, and (particularly) in the U.S., its second-largest market,” Bertelsmann said in a statement.

The company has a reputation of publishing big names in non-fiction, especially in the realm of politics, from Bob Woodward’s “All The President’s Men” to Hillary Clinton’s memoir, to former National Security Adviser John Bolton’s “The Room Where It Happened,” which faced lawsuits from the Trump White House over its contents this year.

Penguin Random House just recently published former President Obama’s memoir, “A Promised Land,” after publishing former First Lady Michelle Obama’s as well. 

Bertelsmann’s rival News Corp, which owns HarperCollins, slammed the deal.

“There is clearly no market logic to a bid of that size – only anti-market logic,” News Corp chief executive Robert Thomson said in a statement. “Bertelsmann is not just buying a book publisher, but buying market dominance as a book behemoth.”

“This literary leviathan would have 70% of the U.S. literary and general fiction market,” Thomson added. “There will certainly be legal books written about this deal, though I wonder if Bertelsmann would publish them.”

ViacomCBS said profits from the deal will be used to pay down debts and also toward parts of the company they are hoping to expand, including streaming.

Dohle declined to say whether there would be any layoffs, said it was too soon to speculate.

Simon & Schuster was founded in 1924 and put up for sale earlier this year. Its current president and chief executive, Jonathan Karp, will continue to lead the publishing house, Bertelsmann said.

The German conglomerate, which was founded in 1835 and also owns a broad portfolio of broadcast, music and online businesses, has been the sole owner of Penguin Random House since April.

The Associated Press contributed to this report.