Simon & Schuster purchased by private equity firm KKR for $1.62 billion

Simon & Schuster has been sold to the private equity firm KKR, months after a federal judge blocked its purchase by rival publisher Penguin Random House because of concerns that competition would shrink the book market. An executive for KKR is calling the deal a chance to work with “one of the most effective” book publishers.

The private equity giant will buy Simon & Schuster for $1.62 billion in cash, said Paramount Global, the parent company of the storied publishing house. Simon & Schuster will operate as a standalone entity, under the leadership of CEO Jonathan Karp.

“We are delighted,” Karp said Monday. “We will remain an independent company and not only will we continue to thrive, but with the help of KKR we can become even greater.

Paramount, which on Monday reported a loss of $424 million for the three months leading up to June 30, will use sale proceeds to pay down debt. The agreement is subject to government approval, but is unlikely to face the objections raised by the Penguin Random House deal.

Simon & Schuster, where authors include Stephen King, Colleen Hoover and Bob Woodward, is one of the so-called “Big Five” of New York publishing, with others including Penguin Random House, HarperCollins Publishers, Hachette Book Group and Macmillan. HarperCollins, owned by Rupert Murdoch’s News Corp, had expressed interest in buying Simon & Schuster.

Simon & Schuster has had strong sales over the past two years, even as the book market has cooled off. The publisher has scheduled some of the most anticipated fall releases, including Britney Spears’ memoir “The Woman In Me” and Walter Isaacson’s biography of Elon Musk.

Richard Sarnoff, chair of media at KKR, praised Simon & Schuster as effective and well run and said that it would retain editorial independence.

“We’re not going to tell them what to buy, what to publish or what not to publish,” said Sarnoff, a…