LONDON (Reuters) - Shares of educational publisher Pearson (PSON.L), which also owns the Financial Times newspaper, hit fresh 5-year highs as Rupert Murdoch's News Corp. NWSa.N made an unsolicited premium-rich bid for Dow Jones & Co. DJ.N.
Pearson was the main beneficiary of investor interest in UK-listed media shares as the initial News Corp. flashes hit trading screens shortly before the London stock market closed.
News Corp. has made an estimated $5 billion bid to buy Dow Jones & Co., owner of the Wall Street Journal, pitched at $60-a-share, a 65 percent premium to its Monday closing price.
Pearson shares ended 4.6 percent higher at 901 pence.
British regional newspaper group Johnston Press (JPR.L), newspaper publisher Trinity Mirror (TNI.L) and news and financial data company Reuters Group RTR.L rose 3.9, 3.8 and 3.5 percent, respectively.
Pearson's late-session spike pushed it to levels not seen since April 2002, amid renewed investor speculation regarding the fate of the Financial Times, which analysts have repeatedly singled out as a potential disposal amid a private-equity backed leveraged buyout or management-led break-up of the business.
Pearson, headed for the past decade by Texas-born Chief Executive Marjorie Scardino, is a global publishing company that spans school and college textbooks, Penguin books, and the FT Group which includes the Financial Times and publishing assets.
"Today it is up because suddenly financial newspaper assets seem to be worth a lot but tomorrow there might be some profit taking on concerns that competition is going to get more ferocious," said Numis Securities media analyst Lorna Tilbian.
Murdoch and Pearson have been linked previously by analysts who have put News Corp.'s name in the mix as a potential bidder for the London-based company's Financial Times newspaper assets.
Deutsche Bank analysts said in a recent note that Pearson's Financial Times and its other newspaper assets -- it owns Les Echos and 50 percent of the Economist magazine -- held the most obvious hidden value in the company's non-core assets.
Numis has a 630 million pound valuation on the Financial Times newspaper. This compares with the 665 million pound price tag involved when the Telegraph newspaper group was bought by David and Frederick Barclay in 2004 from Hollinger following the resignation of former CEO Conrad Black.
"In a bidding war that could be worth a lot more," Tilbian said, referring to the distinctively pink-papered Financial Times that was launched in 1888 as "the friend of the honest financier."
Tuesday's gains lifted Pearson's market value to just over 7.2 billion pounds.
FT Publishing, whose assets include the newspaper, Economist and www.ft.com, accounted for 16 percent of Pearson's 4.4 billion pound sales in 2006 and 21 percent of operating profit.
Still, anyone with an eye on the Financial Times will recall the comments made by Scardino back in 2002 when she said that a sale of the newspaper would only happen "over my dead body."