Paramount Global (NASDAQ: PARA, PARAA) and KKR today announced
the signing of a definitive agreement pursuant to which KKR will
acquire Simon & Schuster for $1.62 billion in an all-cash
transaction.
"We are pleased to have reached an agreement on a transaction
that delivers excellent value to Paramount shareholders while also
positioning Simon & Schuster for its next phase of growth with
KKR,” said Bob Bakish, President and CEO of Paramount Global. “The
proceeds will give Paramount additional financial flexibility and
greater ability to create long-term value for shareholders, while
also delevering our balance sheet.”
After the closing of the transaction, Simon & Schuster will
become a standalone private company and will continue to be led by
Jonathan Karp, President and CEO and Dennis Eulau, COO and CFO of
Simon & Schuster.
“All of the executives at Simon & Schuster who met with KKR
came away from those conversations impressed with the depth of
KKR’s interest in our business and their commitment to helping us
grow, thrive and become an even stronger company,” said Jonathan
Karp. “With KKR’s support, we look forward to collaborating on new
strategies that will enhance our ability to provide readers a great
array of books and to give authors the best possible publication
they can receive.”
Simon & Schuster has an outstanding reputation in book
publishing, in addition to sustained, strong operating performance
and double-digit revenue growth in the first quarter of 2023. KKR
expects to advance the company’s position as one of the world’s
best-known publishers and distributors with more than 36,000 titles
across adult, children, audio and international categories.
In addition to investing in all areas necessary to establish
Simon & Schuster as a standalone entity, KKR intends to support
numerous growth initiatives, including extending Simon &
Schuster’s strong domestic publishing program across various genres
and categories, expanding its distribution relationships and
accelerating growth in international markets.
KKR will also support Simon & Schuster in creating a
broad-based equity ownership program to provide all of the
company’s more than 1,600 employees the opportunity to participate
in the benefits of ownership after the transaction closes. Since
2011, KKR portfolio companies have awarded billions of dollars of
total equity value to over 60,000 non-management employees across
more than 30 companies.
“Simon & Schuster’s nearly 100-year history is a testament
to the enduring value of creative expression through the written
and spoken word. We are thrilled to invest behind Jon and the
immensely talented organization at Simon & Schuster to support
their mission of delivering marquee content to readers around the
world,” said Ted Oberwager, a Partner who leads the gaming,
entertainment, media and sports verticals within KKR’s Americas
Private Equity business.
Richard Sarnoff, Chairman of Media at KKR, added, “We see a
compelling opportunity to help Simon & Schuster become an even
stronger partner to literary talent by investing in the expansion
of the company’s capabilities and distribution networks across
mediums and markets while maintaining its 99 year legacy of
editorial independence. We also believe the opportunity to create
an ownership culture within one of the world’s top publishers has
enormous potential to create value for all of Simon &
Schuster’s stakeholders.”
Completion of the transaction is subject to customary closing
conditions, including regulatory approvals.
KKR is making its investment in Simon & Schuster primarily
through its North America Fund XIII and has secured fully committed
financing for the transaction. The investment builds on KKR’s deep
experience investing in content-oriented media businesses,
including current and prior investments in Epic Games, Mediawan,
Leonine Studios, Artlist, Skydance Media, BMG and RBmedia, among
others.
LionTree Advisors is acting as financial advisor and Shearman
& Sterling LLP is acting as legal advisor to Paramount. Simpson
Thacher & Bartlett LLP is acting as legal advisor to KKR.
About Simon & Schuster
Simon & Schuster is a global leader in general interest
publishing, dedicated to providing the best in fiction and
nonfiction for readers of all ages, and in all printed, digital and
audio formats. Its distinguished roster of authors includes many of
the world’s most popular and widely recognized writers, and winners
of the most prestigious literary honors and awards. It is home to
numerous well-known imprints and divisions such as Simon &
Schuster, Scribner, Atria Books, Gallery Books, Adams Media, Avid
Reader Press, Simon & Schuster Children’s Publishing and Simon
& Schuster Audio and international companies in Australia,
Canada, India and the United Kingdom, and proudly brings the works
of its authors to readers in more than 200 countries and
territories. For more information about Simon & Schuster,
please visit www.simonandschuster.com.
About Paramount
Paramount Global (NASDAQ: PARA, PARAA) is a leading global
media, streaming and entertainment company that creates premium
content and experiences for audiences worldwide. Driven by iconic
consumer brands, Paramount's portfolio includes CBS, Showtime
Networks, Paramount Pictures, Nickelodeon, MTV, Comedy Central,
BET, Paramount+ and Pluto TV. Paramount holds one of the industry's
most extensive libraries of TV and film titles. In addition to
offering innovative streaming services and digital video products,
the company provides powerful capabilities in production,
distribution, and advertising solutions.
For more information about Paramount, please visit
www.paramount.com and follow @ParamountCo on social platforms.
About KKR
KKR is a leading global investment firm that offers alternative
asset management as well as capital markets and insurance
solutions. KKR aims to generate attractive investment returns by
following a patient and disciplined investment approach, employing
world-class people, and supporting growth in its portfolio
companies and communities. KKR sponsors investment funds that
invest in private equity, credit and real assets and has strategic
partners that manage hedge funds. KKR’s insurance subsidiaries
offer retirement, life, and reinsurance products under the
management of Global Atlantic Financial Group. References to KKR’s
investments may include the activities of its sponsored funds and
insurance subsidiaries. For additional information about KKR &
Co. Inc. (NYSE: KKR), please visit KKR’s website at www.kkr.com and
on Twitter @KKR_Co.
CAUTIONARY NOTE CONCERNING FORWARD-LOOKING STATEMENTS
This communication contains both historical and forward-looking
statements, including statements related to our future results and
performance. All statements that are not statements of historical
fact are, or may be deemed to be, forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
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goals are or may be forward-looking statements. These
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other factors that are difficult to predict and which may cause our
actual results, performance or achievements to be different from
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implied by these statements. These risks, uncertainties and other
factors include, among others: risks related to our streaming
business; the adverse impact on our advertising revenues as a
result of changes in consumer viewership, advertising market
conditions and deficiencies in audience measurement; risks related
to operating in highly competitive industries, including cost
increases; our ability to maintain attractive brands and to offer
popular content; changes in consumer behavior, as well as evolving
technologies and distribution models; the potential for loss of
carriage or other reduction in or the impact of negotiations for
the distribution of our content; damage to our reputation or
brands; risks related to our ongoing investments in new businesses,
products, services, technologies and other strategic activities;
losses due to asset impairment charges for goodwill, intangible
assets, FCC licenses and programming; risks related to
environmental, social and governance (ESG) matters; evolving
business continuity, cybersecurity, privacy and data protection and
similar risks; content infringement; domestic and global political,
economic and regulatory factors affecting our businesses generally;
the impact of COVID-19 and other pandemics and measures taken in
response thereto; liabilities related to discontinued operations
and former businesses; the loss of existing or inability to hire
new key employees or secure creative talent; strikes and other
union activity, including the ongoing Writers Guild of America
(WGA) and Screen Actors Guild-American Federation of Television and
Radio Artists (SAG-AFTRA) strikes; volatility in the price of our
common stock; potential conflicts of interest arising from our
ownership structure with a controlling stockholder; and other
factors described in our news releases and filings with the
Securities and Exchange Commission, including but not limited to
our most recent Annual Report on Form 10-K and reports on Form 10-Q
and Form 8-K. There may be additional risks, uncertainties and
factors that we do not currently view as material or that are not
necessarily known. The forward-looking statements included in this
communication are made only as of the date of this communication,
and we do not undertake any obligation to publicly update any
forward-looking statements to reflect subsequent events or
circumstances.
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version on businesswire.com: https://www.businesswire.com/news/home/20230807410154/en/
For Simon & Schuster Adam Rothberg Senior Vice
President, Corporate Communications, Simon & Schuster (917)
270-1717 adam.rothberg@simonandschuster.com For Paramount
Media: Justin Dini, Executive Vice President, Head of
Communications, (212) 846-2724 justin.dini@paramount.com Allison
McLarty, Senior Vice President, Corporate and Financial
Communications (630) 247-2332 allison.mclarty@paramount.com
Investors: Kristin Southey, Executive Vice President, Investor
Relations (310) 593-1630 kristin.southey@paramount.com Jaime
Morris, Senior Vice President, Investor Relations (646) 824-5450
jaime.morris@paramount.com For KKR Miles Radcliffe-Trenner
and Emily Cummings (212) 750-8300 media@kkr.com
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