20 July 2007

Reed Elsevier announces $4bn sale of Harcourt division

Reed Elsevier has announced that it has entered into a definitive agreement to sell its Harcourt US Schools Education business to Houghton Mifflin Riverdeep Group for a consideration of $4bn, with $3.7bn payable in cash and $0.3bn payable in common stock of Houghton Mifflin Riverdeep Group. The sale is expected to complete by the first half of 2008 following US regulatory review. International law firm Freshfields Bruckhaus Deringer is advising Reed Elsevier on the sale.

On completion of the sale and the previously announced disposal of Harcourt Assessment and Harcourt Education International to Pearson plc in May 2007, Reed Elsevier will have sold the whole of its Harcourt Education division for total gross proceeds of $4.95bn, representing 20.8 x 2006 adjusted operating profit. Freshfields also advised Reed Elsevier on the May disposal.

The Freshfields team was led by London corporate partner Julian Long with partner David Crook and associate Michael Hilton, and included partners Edward Evans (finance), Jonathan Cooklin (tax), David Aitman (antitrust competition and trade), Mark Wheelhouse (real estate), Justin Watts (IP/IT), Dan Schaffer (pensions) and Nicholas Squire (employment).

Freshfields is also advising the client on the proposed return of proceeds to shareholders by the two parent companies Reed Elsevier plc and Reed Elsevier NV following the completion of the sale transactions. The team is led by Julian Long in London with corporate associate Jennifer Bethlehem and tax partner Jonathan Cooklin (partner, tax); and in The Netherlands by Robert ten Have (partner, corporate) with Machiel Lambooij (partner, tax).

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