More leaks about the potential sale of Simon & Schuster continue to spill out, and for those who've been paying attention to the S&S sale saga, those details are likely to create a sense of déjà vu.
The latest leak has been published in the Wall Street Journal, and it puts HarperCollins—which, like the WSJ, is owned by News Corp—and the private equity firm KKR as among the frontrunners to buy the country’s third largest publisher. Both were among the losing bidders to Penguin Random House’s $2.2 billion offer. PRH’s acquisition, of course, was blocked by the government last fall.
HarperCollins CEO Brian Murray, while acknowledging that a HC bid for S&S could be complicated by the same antitrust concerns raised by PRH’s failed effort, has expressed interest in trying again. At an appearance at the London Book Fair in April, Murray said that he believed it wouldn’t be impossible for HC to buy S&S. He noted that, toward the end of the trial, presiding judge Florence Pan intimated that she knew another publisher could try to acquire S&S.
“So to me that was a sign that the door is open. But it's definitely harder,” he said. “The bar is higher…there's a whole new set of data that would have to be collected, for anybody who asked for another publisher. I think it would take time to get a deal closed. But it's not impossible.”
HC and a number of private equity firms have long been seen as the most likely S&S buyer following the disintegration of the PRH-S&S deal. The most interesting bit in the WSJ report was the reveal of a clearer timeline: second bids are due by mid-July, and a deal could be completed by the end of summer. Executives at Paramount Global, S&S’s parent company, have said on several occasions that they expect to complete a purchase before the end of the year.
Downsizing Real Estate Footprint
In a memo, CEO Brian Murray informed HC’s North American workforce of significant changes being made to its physical office space. Pointing to how improvements in technology have made it easier to communicate with colleagues, authors, and partners virtually, Murray said that HC will not be renewing its office leases in San Francisco and Grand Rapids, and that it is in the process of evaluating the business needs for flexible space in those cities as well as in Boston.
No changes are coming to HC’s largest offices in New York, home to the trade group; Toronto, headquarters for Harlequin; and Nashville, home to the Christian division. Those cities, Murray wrote “will remain creative hubs…where teams can gather to connect, collaborate, and innovate.”
Murray said that streamlining its office footprint will give HC more funds to invest in its business.
“These transitions in our ways of working will in no way diminish our commitment to our current employees and to maintaining a geographically diverse employee population,” Murray wrote. “I see our employee populations across the country as an advantage to HarperCollins, and many of our businesses—from San Francisco, to Boston, to Grand Rapids—have long and important histories in their areas.”
This article has been updated with further information.