Pearson urged to sell Financial Times and Penguin

By Nick Clark, Thursday, 18 August 2011, The Independent

Pearson should offload the Financial Times to fund further expansion in its education business, according to one influential analyst who believes the business could fetch up to £900m. While the FT and Penguin publishing are the blue-chip company's best-known brands, it makes the bulk of its revenues from education.

Claudio Aspesi, an analyst at Bernstein Research, said Pearson "should divest all its non educational-based assets" and concentrate on growth in its core business.

He said despite growth in the FT Group arm, it remained the most exposed to market cycles and was at odds with the rest of the business.

A deal within the next three years could raise £700m-£900m, he said.

Mr Aspesi pointed out Pearson had already made a series of divestments to reshape its business in favour of education. These include Les Echos in France, the newspaper publisher Recoletos in Spain and its stake in FT Deutschland. With last year's sale of IDC, it raised a further £1.2bn.

He said: "The proceeds have been used to expand the company's education portfolio rather than bolster the FT Group, an indication of where we believe management is ultimately directing the company".

Pearson has repeatedly denied it would consider selling either the FT or Penguin. In the first half it reported sales had risen 6 per cent to £203m.