News Corp agrees to buy Houghton Mifflin unit for US$349m

[NEW YORK] Rupert Murdoch's News Corp agreed to buy the consumer arm of educational publisher Houghton Mifflin Harcourt for US$349 million, the media company's second publishing acquisition in less than a week.

The all-cash purchase of the Houghton Mifflin unit gives News Corp access to high-profile novels from authors including George Orwell and JRR Tolkien. The New York media giant said last Thursday that it had agreed to buy Investor's Business Daily for US$275 million.

News Corp touted the addition of Houghton Mifflin's extensive backlist of titles to the company's HarperCollins publishing unit in a statement on Monday. "Backlists have proven to be a sustainable and growing source of revenues, high margins and cash flow for publishers, particularly evergreen properties with broad, enduring and global appeal," News Corp said.

For its part, Houghton Mifflin said the sale of its Books & Media unit would allow the remaining company to "focus singularly on K-12 education and accelerate growth momentum in digital sales, annual recurring revenue and free cash flow while paying down a significant portion of its debt."

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