Pearson is reportedly planning to explore a sale of the Financial Times newspaper, as the company focuses on its faster-growing education business.
The company has decided to consider offers for the newspaper this year, according to well-informed sources who spoke to Bloomberg on the condition of anonymity.
Pearson may initiate sale preparations ahead of the departure of chief executive officer Marjorie Scardino, who is stepping down in January. Pearson has not hired an investment bank to advise on the sale, the sources said.
Pearson denied the report. "We have said many times that the FT is a valued and valuable part of Pearson," a company spokesman said.
"We are not in the habit of responding to rumours, speculation or reports about our portfolio; however, this particular Bloomberg story is wrong."
During her 16-year tenure, Ms Scardino defended her company's ownership of the Financial Times, Britain's flagship financial daily, for which Pearson may seek as much as £1 billion pounds ($A1.5 billion), a person familiar with the matter said. FT Group accounts for about 8 per cent of Pearson's revenue and 12 per cent of profit.
Potential bidders might include wealthy individuals from Russia, the Middle East or Asia, as well as Bloomberg, one of the people said. Bloomberg, the parent of Bloomberg News, has made an offer for the newspaper before and been turned down, another person said.
News Corp may not bid due to regulatory concerns because it already owns the London-based Times newspaper, a person said. Thomson Reuters may also decide not to make an offer, another person said.
David Girardin, a spokesman for Thomson Reuters, and Nathaniel Brown, a spokesman for News Corp, declined to comment. A Bloomberg spokeswoman for also declined to comment.
Profit rises FT Group, which owns the newspaper and a 50 per cent stake in The Economist magazine, reported a 27 per cent rise in adjusted operating profit to £76 million last year.
Ian Whittaker, an analyst with Liberum Capital, says the newspaper group is worth £777 million , based on 2012 estimates of the company's earnings. The New York Times Co. currently trades at 4.8 times Ebitda.
Pearson has been emphasiSing its education and professional businesses, which provide texts and software for students and employees, through acquisitions. The North American education unit accounted for more than half of operating income last year, growing 19 per cent to 493 million pounds.
Last week, the company agreed to combine its Penguin unit with Bertelsmann SE's Random House to create the largest book publisher in the Uk and the U.S. The Penguin deal was indicative of the firm's determination to focus on education, one of the people said.
Over the past 12 months, Pearson has made a series of 10 acquisitions for a total of $1.2 billion in the education industry, which has proven more profitable than its journalism business. FT Group accounts for about 8 per cent of Pearson's revenue and 12 per cent of profit.
Bloomberg, with Reuters