Penguin and Random House in merger talks

A successful deal would create world's largest book publisher out of two of the 'big six' companies that dominate the industry.

The owners of Penguin and Random House are in talks about merging their publishing arms to create the world's biggest books publisher.

A merger would bring together two of the world's "big six" publishers to create a new powerhouse that would publish 25% of all books sold in the UK.

A Pearson spokesman confirmed the merger talks were active, but said the companies "have not reached agreement, and there is no certainty that the discussions will lead to a transaction".

Analysts have long predicted a further round of consolidation in the book trade, which is dominated by HarperCollins, Random House, Hachette, Simon & Schuster, Macmillan and Penguin. The industry has changed rapidly in recent years following the introduction of ebook readers and mass-market selling via supermarkets.

Read more:  Penguin and Random House in merger talks: