Pearson Short-Lists 4 Bids In 2nd Round Of IDC Sale - Sources
March 01 2010 - 1:27PM
Dow Jones News
Pearson PLC (PSO) has short-listed four bids to go into the
second round of the sale of Interactive Data Corp. (IDC), the
U.S.-listed financial data provider majority owned by the U.K.
publisher, people familiar with the situation told Dow Jones
Newswires on Monday.
McGraw Hill Cos. (MHP) and Apax Partners are among the
successful bidders, while Permira and Carlyle Group, which had bid
jointly are out, people said. The remaining two bids come from
buyout firms either bidding jointly or alone. Bain Capital LLC and
Advent International Corp.; and Hellman & Friedman LLC and
Silver Lake Partners submitted joint bids in the first round and
other potential bidders include Kohlberg, Kravis, Roberts;
Providence Equity Partners; and TPG, people have said.
Due diligence will start this week for the short-listed bidders,
a person familiar with the matter said, with management
presentations expected next week.
Pearson, which also publishes the Financial Times newspaper and
owns a large U.S. educational publishing business, wasn't
immediately available for comment.
In January it said that IDC's board was conducting a
"preliminary review of strategic alternatives."
It owns 61% of IDC's shares and both companies have remained
consistently tight-lipped on the strategic review referring to
earlier statements indicating that they don't wish to comment
further.
The transaction value for the whole business is being put at
around $3 billion and private equity buyers would be looking to
fund this with around 40% cash and 60% debt, people have previously
said.
Goldman Sachs (GS), which is running the sales process and
wasn't immediately available to comment, is offering staple
financing, people said. Staple finance is typically arranged by the
vendor's advising bank in the sale of a business. The winning
bidder has the option to accept the loan on offer or make its own
financing arrangements.
Earlier Monday, Pearson posted market-beating earnings and sales
for 2009 buoyed by its extensive education operations in the U.S.,
digital learning and the strength of the dollar against sterling.
Net profit jumped 46% to GBP425 million in 2009 from GBP292 million
a year ago on the back of a 17% increase in sales to GBP5.62
billion from GBP4.81 billion. Underlying sales rose 2%. A Pearson
spokesman declined to comment on the sale process.
A McGraw Hill spokesman declined to comment. IDC declined to
comment.
-By Marietta Cauchi and Jessica Hodgson, Dow Jones Newswires;
+44 207 842 9241; marietta.cauchi@dowjones.com
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