13th Dec 2007 07:01
Reed Elsevier PLC13 December 2007 News Release Issued on behalf of Reed Elsevier PLC and Reed Elsevier NV 7.00am (GMT) 13 December 2007 COMPLETION OF THE SALE OF HARCOURT US SCHOOLS EDUCATION BUSINESS TO HOUGHTON MIFFLIN RIVERDEEP GROUP DETAILS OF SPECIAL DISTRIBUTION AND SHARE CONSOLIDATION Reed Elsevier is pleased to announce the completion of the sale of its HarcourtUS Schools Education Business to Houghton Mifflin Riverdeep Group for $4.0billion. This transaction, together with the sales of the Harcourt Assessment andHarcourt Education International businesses to Pearson plc, will deliver to ReedElsevier total gross proceeds for the whole of its Harcourt Education divisionof $4.95 billion. This represents 20.8 x 2006 adjusted operating profit; thecapital employed, including goodwill and intangible assets, of the HarcourtEducation division as of 31 December 2006 was $2.6 billion. The aggregate net proceeds of the sale of the Harcourt Education division, aftertaxes and other transaction costs, is approximately $4.0 billion and will bereturned to shareholders by way of a Special Distribution followed by acorresponding consolidation of the share capitals of Reed Elsevier PLC and ReedElsevier NV, details of which are set out below. The sale of the HarcourtAssessment business to Pearson is expected to close in late 2007/early 2008following US regulatory review and the Special Distribution will be maderegardless of whether or not this sale has closed. The sale of the HarcourtEducation International businesses to Pearson completed earlier in 2007. Details of the Special Distribution and Share Consolidation are as follows: The net proceeds of $4.0 billion will be distributed to shareholders inaccordance with the equalisation ratio, such that shareholders in Reed ElsevierPLC and Reed Elsevier NV will receive approximately 52.9% and 47.1% of thedistribution, respectively. The special distribution will not be made on the Rshares which are held by Reed Elsevier PLC in Reed Elsevier NV, as they arealready taken into account in the equalisation ratio. Reed Elsevier PLCshareholders will receive a Special Distribution of 82.0p per share and ReedElsevier NV shareholders will receive a Special Distribution of €1.767 pershare. The Special Distribution will be accompanied by a Share Consolidation for bothReed Elsevier PLC and Reed Elsevier NV, the terms of which were approved at bothcompanies' Annual General Meetings earlier this year. The Special Distributionis equivalent to 13.4% of the combined market capitalisation of Reed ElsevierPLC and Reed Elsevier NV (not including the R shares held by Reed Elsevier PLCin Reed Elsevier NV) and the effect of the Share Consolidation will be to reducethe number of ordinary shares in issue in Reed Elsevier PLC and Reed Elsevier NVby the same percentage. The purpose of the Share Consolidation is to facilitatecomparability of earnings per share and share prices before and after thepayment of the Special Distribution. For each company, the Share Consolidationwill be on the basis of 58 New Ordinary Shares for every 67 Existing OrdinaryShares. The expected timeline of principal events is as follows: Friday, 4 January, Last day of dealings in Existing Reed Elsevier PLC Ordinary Shares and2008 Existing Reed Elsevier NV Ordinary Shares 6.00pm (GMT) on Record Date for entitlement to the Special Distribution and for the ShareFriday, 4 January, Consolidation2008 Monday, 7 January, Ex-dividend date for Special Distribution2008 Effective date for Share Consolidation Listing of and commencement of dealings in New Reed Elsevier PLC Ordinary Shares on the London Stock Exchange Listing of and commencement of dealings in New Reed Elsevier NV Ordinary Shares on Euronext Amsterdam New Reed Elsevier PLC Ordinary Shares enabled in CREST and CREST accounts credited with New Reed Elsevier PLC Ordinary Shares Wednesday, 9 January New Reed Elsevier NV Ordinary Shares enabled in Euroclear Nederland and2008 Euroclear Nederland accounts credited with New Reed Elsevier NV Ordinary Shares Friday, 18 January, Payment of the Special Distribution, settlement of fractional entitlements2008 to New Reed Elsevier PLC and New Reed Elsevier NV Ordinary Shares and despatch of certificates for New Reed Elsevier PLC Ordinary Shares in Certificated Form. The Special Distribution per American Depository Share (ADS) is the US dollarequivalent of 328.0p per Reed Elsevier PLC ADS and €3.534 per Reed Elsevier NVADS. For each company, the Share Consolidation will be on the basis of 58 newADSs for every 67 existing ADSs. The last day of trading in the Existing ADSsin Reed Elsevier PLC and Reed Elsevier NV will be 4 January 2008 and trading inthe new ADSs will commence on 7 January 2008. Holders of Existing ADSs as atthe close of trading in New York on 4 January 2008 and after will be entitled toreceipt of the Special Distribution on exchange of their existing ADSs for newADSs. The US dollar amounts of the Special Distribution will be determined onor about 21 January 2008 and be available for payment to ADS holders on andafter 28 January 2008 in accordance with the terms of the depositaryarrangements. Notes: PLC NVOrdinary Shares in issue, including Ordinary Shares held by the 1,269,007,800 734,710,359Employee Benefit Trust The Special Distribution will not be made on the R shares which are held by ReedElsevier PLC in Reed Elsevier NV and represent 5.8% of Reed Elsevier NV's sharecapital, nor on the ordinary shares held in Treasury other than those held bythe Employee Benefit Trust, and these shares are excluded from the figuresabove. - ends - For further information please contact: Sybella Stanley (Investors)+44 20 7166 5630 Patrick Kerr (Media)+44 20 7166 5646 Notes to editors Reed Elsevier Group plc Reed Elsevier Group plc is a world leading publisher and information provider.It is owned equally by its two parent companies, Reed Elsevier PLC and ReedElsevier NV. The parent companies are listed on the London, Amsterdam and NewYork Stock Exchanges, under the following ticker symbols: London: REL;Amsterdam: REN; New York: RUK and ENL. In 2006, Reed Elsevier made adjustedprofit before taxation of £1,052 million on turnover of £5,398 million. Thegroup employs 36,000 people, including approximately 20,000 in North America.Operating in the scientific, legal, educational and business-to-businesssectors, Reed Elsevier provides high value and flexible information solutions toprofessional end users, with increasing emphasis on internet delivery. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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