Pearson Sells The Economist

Publishers Lunch

Following the recent sale of the Financial Times to Nikkei, Pearson has now sold its 50 percent stake in The Economist Group as well, for £469 million (or $731 million). Three-fifths of their stake (or a 30 percent share in the Economist) goes to Exor, the holding company for minority shareholder Agnelli, while the remaining portion (a 20 percent share) has been bought back by the Economist Group itself, funded by the sale of their headquarters, the Economist Complex, which has been the editorial team's home for more than five decades. Pearson noted the "proposed changes will be put to a shareholder vote next month and include a 20 percent voting cap for any individual shareholder, and a rule that no one individual or company can own more than 50 percent of the Group's shares."

As with the £844 million/$1.3 billion sale of the Financial Times, Pearson is expected to use the funds to pay down debt and fuel additional acquisitions in education. The Economist sale will reaffirm investor expectations that Pearson will look to sell their minority share Penguin Random House at some point over the next couple of years, per ceo John Fallon's premature declaration last month that "Pearson will now be 100 percent focused on our global education strategy