Pearson sells off leisure arms for pounds 350m

MADAME TUSSAUD'S and its related amusement park business will announce today that it has been sold by Pearson for around pounds 350m to Charterhouse Development Capital.

The long-awaited sale of the waxworks and Alton Towers leisure business will boost Pearson's resources just as market rumours are suggesting that its $4.6bn acquisition of Simon & Schuster's education and reference publishing house is running into problems.

Pearson refused to comment on either the Tussaud's sale or the Simon & Schuster deal.

Pearson has arranged to sell on parts of the Simon & Schuster business it does not want to an American investment firm Hicks, Muse Tate & Furst for $1bn.

Rumours are circulating Wall Street that Hicks, Muse is unable to go ahead with its part of the deal because its financing for the acquisition has fallen victim to turmoil in the bond markets and the global liquidity crunch. It is understood that Pearson has received reassurances from Hicks, Muse that the rumours are unfounded, and that it is ready to go ahead with the deal.

Pearson, however, has the financing in place to go ahead without Hicks, Muse and buy the entire education and reference house if need be.

Indeed, Pearson originally intended to buy the entire business on its own, but did the deal with Hicks, Muse when the latter indicated it was interested in the parts Pearson did not intend to keep long-term.

If the deal does go ahead without the American investment firm, Pearson will merely change its timetable for selling the surplus businesses when global markets have recovered.

In May, Pearson agreed to pay $4.6bn to US-based entertainment group Viacom, the US-based entertainment group, for the Simon & Schuster businesses. Under the terms of its deal with Hicks, the investment firm will pay Pearson $860m in cash, together with a distribution deal worth about $160m.

The Wall Street rumours suggest that Hicks no longer has access to the $500m of debt needed to fund the deal because of the effective collapse of the high-yield bond market.

The deal also has to be approved by US anti-trust regulators. Pearson's share price rose strongly after the announcement of the proposed acquisition.

The deal forms part of Pearson's intention to focus on media operations and get out of others such as Madame Tussaud's.

The sale of Madame Tussaud's will be structured in the form of a management buyout. Charterhouse outbid Viacom and Compass Partners International, a rival UK buyout fund. Lazard Brothers handled the deal on behalf of Pearson.

Pearson has already raised about pounds 58m from the sale of its Spanish theme park earlier in the year.

Start your day with The Independent, sign up for daily news emails
ebooks
ebooksAn introduction to the ground rules of British democracy
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
SPONSORED FEATURES
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Financial Administrator

£19000 - £22000 per annum: Recruitment Genius: An exciting opportunity has ope...

Recruitment Genius: Mortgage Administration Team Leader

Negotiable: Recruitment Genius: This company prides itself on its ability to p...

Recruitment Genius: Mortgage Advisor

Negotiable: Recruitment Genius: This company prides itself on its ability to p...

Ashdown Group: Solvency II Project Manager - 10 month contract - £800 p/d

£800 per day: Ashdown Group: A highly successful, global financial services co...

Day In a Page

A Very British Coup, part two: New novel in pipeline as Jeremy Corbyn's rise inspires sequel

A Very British Coup, part two

New novel in pipeline as Jeremy Corbyn's rise inspires sequel
Philae lander data show comets could have brought 'building blocks of life' to Earth

Philae lander data show comets could have brought 'building blocks of life' to Earth

Icy dust layer holds organic compounds similar to those found in living organisms
What turns someone into a conspiracy theorist? Study to look at why some are more 'receptive' to such theories

What turns someone into a conspiracy theorist?

Study to look at why some are more 'receptive' to such theories
Chinese web dissenters using coded language to dodge censorship filters and vent frustration at government

Are you a 50-center?

Decoding the Chinese web dissenters
The Beatles film Help, released 50 years ago, signalled the birth of the 'metrosexual' man

Help signalled birth of 'metrosexual' man

The Beatles' moptop haircuts and dandified fashion introduced a new style for the modern Englishman, says Martin King
Hollywood's new diet: Has LA stolen New York's crown as the ultimate foodie trend-setter?

Hollywood's new diet trends

Has LA stolen New York's crown as the ultimate foodie trend-setter?
6 best recipe files

6 best recipe files

Get organised like a Bake Off champion and put all your show-stopping recipes in one place
Ashes 2015: Steven Finn goes from being unselectable to simply unplayable

Finn goes from being unselectable to simply unplayable

Middlesex bowler claims Ashes hat-trick of Clarke, Voges and Marsh
Mullah Omar, creator of the Taliban, is dead... for the fourth time

Mullah Omar, creator of the Taliban, is dead... again

I was once told that intelligence services declare their enemies dead to provoke them into popping up their heads and revealing their location, says Robert Fisk
Margaret Attwood on climate change: 'Time is running out for our fragile, Goldilocks planet'

Margaret Atwood on climate change

The author looks back on what she wrote about oil in 2009, and reflects on how the conversation has changed in a mere six years
New Dr Seuss manuscript discovered: What Pet Should I Get? goes on sale this week

New Dr Seuss manuscript discovered

What Pet Should I Get? goes on sale this week
Oculus Rift and the lonely cartoon hedgehog who could become the first ever virtual reality movie star

The cartoon hedgehog leading the way into a whole new reality

Virtual reality is the 'next chapter' of entertainment. Tim Walker gives it a try
Ants have unique ability to switch between individual and collective action, says study

Secrets of ants' teamwork revealed

The insects have an almost unique ability to switch between individual and collective action
Donovan interview: The singer is releasing a greatest hits album to mark his 50th year in folk

Donovan marks his 50th year in folk

The singer tells Nick Duerden about receiving death threats, why the world is 'mentally ill', and how he can write a song about anything, from ecology to crumpets
Let's Race simulator: Ultra-realistic technology recreates thrill of the Formula One circuit

Simulator recreates thrill of F1 circuit

Rory Buckeridge gets behind the wheel and explains how it works