Bertelsmann has emerged as the winning bidder for Simon & Schuster. In an announcement this morning, the parent company of Penguin Random House said it had reached an agreement to buy S&S from ViacomCBS for $2.175 billion.

Following regulatory approvals, the deal is expected to be completed sometime in 2021. Until the purchase is completed, S&S will continue to operate independently under the direction of Jonathan Karp, president & CEO of S&S, and Dennis Eulau, COO and CFO.

In his letter to employees, PRH worldwide CEO Markus Dohle wrote: “Simon & Schuster aligns completely with the creative and entrepreneurial culture that we nurture by providing editorial autonomy to our publishers, funding their pursuit of new stories, ideas, and voices, and maximizing reach for our authors. We recognize—and our success has demonstrated— that collaboration makes us all stronger, and by bringing Simon & Schuster onto our global platform, we will be able to connect their authors and books with even more readers.”

The purchase combines the country’s largest and third largest trade publishers, and it will have revenues of close to $3 billion. In bringing the two companies together, Dohle wrote, “we will apply the same thoughtfulness and respect to the process with Simon & Schuster that we did with the Penguin and Random House merger in 2013, and we will communicate and share with you directly and regularly throughout this time.”

In a statement, Bertelsmann chairman and CEO Thomas Rabe said following Bertelsmann’s acquisition of the final stake Pearson had owned in PRH earlier this year, the S&S purchase “marks another strategic milestone in strengthening our global content businesses,” adding: “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.”

In acquiring S&S, Bertelsmann beat out several competitors, most notably HarperCollins, the country’s second largest trade publisher. Last week, the New York Times reported that Bertelsmann and HarperCollins were the top contenders for S&S, with the purchase price put over $1.7 billion. The nearly $2.2 billion price tag for S&S is likely the reflection of the fact that a publisher its size will not be on the market in the foreseeable future. If HC had acquired S&S, it would have closed the gap between PRH and itself considerably; HC’s U.S. sales are estimated at about $1.1 billion, compared to PRH's current sales of about $2.2 billion.

A very happy Dohle told PW today was a “good day for books, book publishing, and reading.” He said the S&S purchase reflects Bertelsmann’s “firm belief in the future of book publishing.”

The merger of Penguin and Random House met with little regulatory resistance, and the deal was closed in about eight months. Dohle would not put a timetable on when the S&S deal would be completed, but said he does not expect any antitrust issues to arise. He said the U.S. book market remains highly fragmented and that even since the Penguin Random House merger eight years ago, new publishing companies have been formed and continue to grow. He said looking at the entire book market including self-publishing, PRH's market share is about 14.2%, and S&S's 4.2%.

This story has been updated for clarity.