Pearson has filed a breach-of-contract suit against the investment banking firm of Hicks, Muse, Tate &Furst, charging the firm with misleading Pearson into believing that Hicks was prepared to buy approximately $860 million in assets following Pearson's $4.6-billion purchase of Simon &Schuster. Hicks backed out of the agreement at the last minute, claiming that the financial performance of the companies it was interested in buying was not what it expected.
In light of Hicks's decision, Pearson held on to several divisions that Hicks was to buy, most notably the computer book operations. Pearson is now in the process of divesting a number of other properties, including the Macmillan Reference Library division. Pearson intends to sell the division as a single company; first bids were due March 19.
