10 November 2012 - 11:36am | posted by | 0 comments

New report accuses Pearson of "aggressively" and "unsustainably" ramping up price of Financial Times

New report accuses Pearson of "aggressively" and "unsustainably" ramping up price of Financial Times New report accuses Pearson of "aggressively" and "unsustainably"

This week analysis have been predicting that the Financial Times could be sold for £1 billion, however one City analyst has claimed that Pearson, the owner of the Financial Times, has been pushing up the title’s price "aggressively" and "unsustainably", resulting in a ‘misplaced assumption’ that the company’s newspaper division is valued at £1 billion.

Mark Braley, a Deutsche Bank analyst, researched the Financial Time’s readership levels, prospects, and pricing model after he was charged £353 for a subscription renewal.

In his report he went on to say that Pearson is likely to sell Financial Times Group to focus on its education business, possibly fetching around £600 million to £700 million.

But added: “To get to a valuation of £1 billion seems to rely on that kind of buyer who might also be in the market for football teams, art, pigs with mystical healing powers and trips into space.

“That does not seem to us to form any reasonable part of an investment thesis.”

Braley continued: “The issue is simply that the FT isn’t a very profitable business. Prospective strategic buyers are limited.”

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