Paramount has agreed to sell Simon & Schuster to private equity firm KKR for $1.6 billion in cash, after more than three years of trying to offload the book publishing powerhouse.
I’m not thrilled after what they’ve done to other companies, looking at you Toys 'R Us, and what they’ve done since taking control of OverDrive. Probably better than letting Penguin Randomhouse have a more significant cut of publishing, but not much.
Well, RIP Simon & Schuster. I give em five years, tops.
@pluralistic aka Cory Doctorow just wrote an excellent, in depth article on this acquisition on Pluralistc:
Let’s review a little of KKR’s track record, shall we? Most spectacularly, they are known for buying and destroying Toys R Us in a deal that saw them extract $200m from the company, leaving it bankrupt, with lifetime employees getting $0 in severance even as its executives paid themselves tens of millions in “performance bonuses”:
The pillaging of Toys R Us isn’t the worst thing KKR did, but it was the most brazen. KKR lit a beloved national chain on fire and then walked away, hands in pockets, whistling. They didn’t even bother to clear their former employees’ sensitive personnel records out of the unlocked filing cabinets before they scarpered:
But as flashy as the Toys R Us caper was, it wasn’t the worst. Private equity funds specialize in buying up businesses, loading them with debts, paying themselves, and then leaving them to collapse. They’re sometimes called vulture capitalists, but they’re really vampire capitalists:
https://www.motherjones.com/politics/2022/05/private-equity-buyout-kkr-houdaille/
Given a choice, PE companies don’t want to prey on sick businesses – they preferentially drain off value from thriving ones, preferably ones that we must use, which is why PE – and KKR in particular – loves to buy health care companies.
Heard of the “surprise billing epidemic”? That’s where you go to a hospital that’s covered by your insurer, only to discover – after the fact – that the emergency room is operated by a separate, PE-backed company that charges you thousands for junk fees. KKR and Blackstone invented this scam, then funneled millions into fighting the No Surprises Act, which more-or-less killed it:
https://pluralistic.net/2020/04/21/all-in-it-together/#doctor-patient-unity
KKR took one of the nation’s largest healthcare providers, Envision, hostage to surprise billing, making it dependent on these fraudulent payments. When Congress finally acted to end this scam, KKR was able to take to the nation’s editorial pages and damn Congress for recklessly endangering all the patients who relied on it:
https://pluralistic.net/2022/03/14/unhealthy-finances/#steins-law
