Reed Elsevier sells US education arm

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The Independent Online

The Anglo-Dutch publisher Reed Elsevier sold itsUS education arm, Harcourt, to Houghton Mifflin Riverdeep for $4bn (£2bn) yesterday.

The cash and paper sale follows a string of deals in the education sector as the industry undergoes a major shake-up. Houghton Mifflin Riverdeep was itself formed by the $1.75bn acquisition of Houghton Mifflin, the fourth largest textbook publisher in the US, by the Irish group Riverdeep last year.

The Dutch publisher Wolters Kluwer also sold its education division to private equity firm Bridgepoint for $1bn last month, and Canadia's Thomson sold its education assets for $7.75bn earlier this year.

Houghton Mifflin Riverdeep, headed by the Irish entrepreneur Barry O'Callaghan, is paying $3.7bn cash and $300m in stock for Harcourt, which publishes textbooks and related educational supplements. It also produces adult education, reference, religious and online learning materials.

Reed Elsevier has said it would return the education unit proceeds to shareholders by way of a special dividend. The company expects exiting education to boost earnings per share on a constant currency basis by at least 10 per cent annually.

Reed earlier sold Harcourt's international and assessment units to Pearson for $950m.

Reed's shares closed up 1.7 per cent at 675p in London, before the deal was announced.

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