Pearson agrees to sell Spanish publishing company.

Pearson, plc. (London) has entered into an agreement to sell its 79% stake in Spanish business and information publisher Recoletos (Madrid) to Retos Cartera (Madrid), an investment vehicle formed by a consortium of Spanish investors, for 743 million[pounds sterling]. The offer is part of Retos Cartera's public tender offer for the entire share capital of Recoletos, valuing the company at 941 million[pounds sterling].

Recoletos is Spain's leading specialty publisher. Sports publishing accounts for more than half the company's revenues. It publishes Expansion, the leading Spanish business and finance title, Marca and Marca Digital, a sports daily and website, Telva, a women's magazine, and Diario Medico, a medical newspaper. The company also owns a 30% stake in Unedisa, publisher of the daily newspaper El Mundo, and a 50% stake in Economica, publisher of Portugal's leading business newspaper. It also has a presence in Argentina, Chile and the U.S. Earlier this year, Recoletos launched "Meximerica," a network of Spanish-language newspapers in the U.S.

The company had sales of 198 million[pounds sterling] and EBITDA of 30 million[pounds sterling] for the first nine months of 2004. As of Sept. 30, 2004, Recoletos had net assets of 283 million[pounds sterling] including 196 million[pounds sterling] in cash. According to terms of the deal, Pearson and Recoletos will enter into a cooperation agreement that will cover paper purchasing, editorial content sharing, joint printing arrangements and ad sales. Pearson also has the first right of refusal to buy Expansion if Recoletos sells it within 18 months of completion of the offer.