Pearson explores sale of ‘Financial Times’

Pearson plc is exploring a sale of the Financial Times after receiving interest from potential buyers, sources said.

London-based Pearson is sounding out possible bidders for the salmon-coloured newspaper, said the people, who asked not to be identified because the deliberations are confidential.

A sale may value the business at as much as £1bn (€1.44bn), two of the people said.

While there is no formal process under way, the Financial Times may draw interest from media companies such as Axel Springer as well as investors in Europe, the Middle East, and Asia, the people said.

Discussions over a disposal, which have been on and off for years, have heated up as CEO John Fallon focuses on tackling a slowdown in the education unit weighed on by falling US college enrolments and declining textbook sales.

No final decision has been made and Pearson may decide to keep the newspaper, the people said.

Representatives for Pearson and Axel Springer declined to comment.

Pearson does not break out financial details for the Financial Times, which is part of the professional education unit that reported £1.15bn in 2014 revenue. The publisher is scheduled to report interim results on July 24.

The Financial Times’s circulation reached 720,000 last year, with digital subscriptions accounting for 70% of the total. In a move to make more money from online readers, the newspaper in February tweaked its paywall system, moving away from a metered model that allows readers to view a few free articles every month before requiring them to pay.

Last November, chief financial officer Robin Freestone said a sale of the Financial Times was not top priority for Pearson. “Do we have to own them? No. But actually it’s one of those brands which, you know, you don’t sell lightly,” Mr Freestone, who will step down next month, told an investor conference on November 19.

German newspaper publisher Axel Springer is in talks to combine with German broadcaster ProSiebenSat.1 Media to strengthen their push into digital media, people familiar with the matter said earlier this month.

A deal would unite Springer’s Bild-Zeitung tabloid and Die Welt newspaper with the ProSieben and Sat.1 commercial TV channels.

Bloomberg