Pearson refuses to expand into football

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The Independent Online
The main board of Pearson, the media and information conglomerate, has rejected an approach by Greg Dyke, who heads its television subsidiary, to consider taking a stake in the booming football sector by buying into a top club.

Pearson's refusal to expand its leisure interests by becoming involved in football is thought to be a last hurrah from the old guard of directors under Lord Blakenham, who is standing down as chairman in the spring.

It also comes as the future status of Pearson Television, which includes Thames TV and Grundy Worldwide, is being examined in a strategic review to coincide with the arrival of Marjorie Scardino as new chief executive of the parent company in a fortnight's time.

Mr Dyke, a keen football fan, believes top clubs, as holders of the rights to televised games, represent an outstanding investment opportunity. He recently spoke of the "untold riches" that awaited leading Premier League clubs Manchester United and Newcastle from the introduction of pay-per- view television next year.

Pearson is the latest media and leisure group to be linked with football, though Granada recently dismissed speculation that it might bid for Manchester United.

Meanwhile, it was confirmed yesterday that a consortium of investors led by the broadcaster Sir David Frost planned to take a substantial minority stake in Southampton, the struggling Premier League side. The consortium has also pledged its support for the board of directors.

Mr Frost and Gavyn Davies, chief economist at Goldman Sachs, the US investment bank, intend to pump several million pounds into the club. The planned investment is separate from a pounds 10m reverse takeover agreed earlier this month by Southampton's directors. Under the proposed deal, Southampton would reverse into Secure Retirement, a property development and healthcare company, and gain a stock market listing. It is yet to be approved by shareholders at an extraordinary general meeting.

Mr Davies, a Southampton season ticket holder for 35 years, insists the consortium's move is motivated by sound commercial reasons - and a love of the Saints.