An article in the November 12 Financial Times reported that Hicks Muse Tate &Furst is seeking to renegotiate the $860 million price it had agreed to pay Pearson for the reference and business and professional divisions of Simon &Schuster. According to FT, the renegotiation is not connected with problems Hicks is having raising financing for the deal, as earlier reports had suggested (News, Oct. 26), but rather is due to the failure of the businesses to hit projected earnings targets.
For the third quarter, the entire S&S operation reported a 3% sales increase, to $887 million, while operating profits fell 8%, to $176 million. For the first nine months of the year, sales were up 1%, to $1.8 billion, although profits were off 12%, to $512 million.
