Pearson revamp could be launched next month

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The Independent Online
New management at Pearson, the media and information conglomerate, are reviewing detailed strategy papers on the future of the company. This could lead to a radical restructuring that could be launched as early as next month.

According to sources at Pearson, a round of meetings will be held from 8 January, the date on which Marjorie Scardino, the company's new chief executive, formally takes over from the retiring Frank Barlow.

On the agenda will be the future status of the company's television subsidiary, which groups Thames Television and Grundy Worldwide, as well as plans to sell theme parks operated under the Madame Tussauds name.

Also under consideration is a possible sale to management of the 50 per cent Pearson holds in Lazard, the investment bank. Pearson would be left with its publishing and information operations, which are viewed as core assets.

A limited number of the secret strategy documents, which are numbered and circulated only to senior managers, have already been sent to Ms Scardino, who is winding up her job as chief executive of the Economist Group, 50 per cent owned by Pearson. They will be discussed in committee, and final decisions will be taken in the course of 1997.

Pearson has been under pressure in recent months to restructure its sprawling operations, which range from the Financial Times to Penguin Books to Mindscape, a money-losing US manufacturer of CD-Roms and game cartridges.

Analysts have suggested that Pearson would remain a takeover target unless it moved to streamline its businesses. They have calculated that Pearson could be worth between pounds 9 and pounds 10 a share if broken up, compared with its closing price yesterday of 706.5p. Pressure from the City led to the early retirement of Mr Barlow and Lord Blakenham, the chairman. Dennis Stevenson, a long-time Pearson board member, is to replace Lord Blakenham in the spring.

Senior management stressed, however, that no decisions had yet been taken on which assets, if any, would be sold. When Ms Scardino's appointment was announced in October, she said that "we have no strategic prejudices and will start with a clean slate".