NEW YORK (CNNfn) - Newspaper publisher Times Mirror Cos. said Monday it will sell its legal publishing holdings to British-based Reed Elsevier Plc in a deal valued at $1.65 billion.
Reed Elsevier is one of the world's largest information providers, with $5 billion in annual revenues. Its holdings embrace such industry standard-bearers as Lexis-Nexis, the leading on-line databank for legal, business, news and government information; Butterworths, the United Kingdom's leading premier legal publisher; and Editions du Juris-Classeur , France's biggest law publisher.
Under the deal, Reed Elsevier will acquire Matthew Bender & Co. and Times Mirror's 50 percent ownership stake in Shepard's, the largest legal citation service in the United States with $70 million in annual revenues.
Times Mirror bought Shepard's from The McGraw-Hill Companies in 1996. But the Los-Angeles based publishing powerhouse subsequently contributed half its interest in Shepard's to Reed Elsevier after Times Mirror and Reed formed a partnership to control Shepard's.
The deal with Matthew Bender is structured as a corporate reorganization in the form of a merger. It is expected to close this summer, subject to regulatory approval. Times Mirror said it expects to report a gain of about $1 billion, or $10.50 a diluted share, from the transaction.
Mark Willes, Times Mirror's chairman, president and chief executive officer said the decision to spin off the legal publishing interests followed a "strategic review" at the company. That review, Willes said, suggested that Matthew Bender's and Shepard's future growth could best be ensured by folding them into a "global legal information provider" such as Reed Elsevier.
For Reed Elsevier, the acquisition offers a firmer footfhold in the US legal information market after its buyout of Lexis-Nexis in 1994, according to Herman Briggink, Reed Elsevier's co-chairman.
Matthew Bender has specialized in the publication of analytical legal research information since 1887. In 1963, the company, which today offers information in both print and electronic form, was acquired by Times Mirror. It currently generates $200 million in revenues.
Los Angeles-based Times Mirror, a leading news and information company, publishes The Los Angeles Times, Newsday, The Baltimore Sun, The Hartford Courant, The Morning Call, The Stamford Advocate and Greenwich Time.
Reed Elsevier plc is owned by Reed International PLC (RUK) and Elsevier NV, which hold equal shares in the company. (ENL). Shares of Times Mirror (TMC) ended down 15/16 Friday at 58-13/16 on the New York Stock Exchange; Reed International climbed ¼ to 40 points, while NV eased 1/8 to close at 31-3/8.