Pearson sells The Economist stake

British media group Pearson announced on Wednesday it's selling its 50-percent stake in the respected weekly magazine The Economist for 469 million pounds ($734 million, 655 million euros).

27.8 percent of shares will be sold to investment group Exor, which is controlled by Italy's Agnelli family. The 287-million-pound price tag also includes so-called "B special" shares, giving Exor the right to appoint six of the publication's 13 board members.

Exor, which also controls carmaker Fiat Chrysler Automobiles, already holds a 4.7-percent stake in The Economist. Wednesday's acquisition takes that number to 43.7 percent, making the Agnelli family the single biggest shareholder, and ending nearly six decades of Pearson rein.

"Pearson is proud to have been a part of The Economist's success over the past 58 years, and our shareholders have benefited greatly from its growth," said Pearson's chief executive John Fallon in a statement.

Staying independent

For Exor, it's an opportunity to shift gears and diversify its portfolio away from the capital intensive and cyclical automotive business.

"We are convinced of the huge potential that still lies ahead and particularly in The Economist's ability to seize the many development opportunities linked to the digitisation of the media industry," said CEO and scion of the Agnelli family John Elkann in a statement.

The Economist was founded in 1843 and became famous for its opinionated journalism pushing free markets. To make sure that continues, The Economist Group will repurchase Pearson's remaining shares.

"The board's priority was to secure the independence of the ownership of the Group and the continued editorial independence of The Economist," said the Group's chairman Rupert Pennant-Rea, the chairman of The Economist Group.

"The strength of the Group's balance sheet meant that we could reorganize our shares so as to reinforce our editorial independence and benefit our shareholders."

Exor added that it would seek to amend The Economist's governance rules to limit the voting powers of any single shareholder to 20 percent, and to make sure that no one individual or company can own more than 50 percent of the Group's shares.

New focus

Pearson's move comes just weeks after it sold its other journalism jewel, The Financial Times, to Japan's Nikkei for 844 million pounds. The wholesale of its news publications completes the company's pivot to education literature.

"Pearson is now 100-percent focused on our global education strategy," Fallon said. "The world of education is changing rapidly and we see great opportunity to grow our business through increasing access to high quality learning globally."

pad/hg (AP, dpa, Reuters)