Has Reed handed Thomson an Education bonus?

The rush to exit the Education publishing market - once so lucrative but now so uncertain and volatile - has turned into a stampede.

The board at Reed Elsevier has certainly chosen its moment to throw its Harcourt division into the ring – the "for sale" sign went up yesterday as the company announced full year results, in which Harcourt was the only division to show a drop in profits. Reed now considers Harcourt a drag on its overall performance and out of step with the other divisions, which are steaming ahead with digitisation, embedded workflow solutions, and booming subscription revenues.

You'd think that the timing of the announcement didn't please execs at the Thomson Corporation, who are currently talking to potential buyers of its Education division. It put the division up for sale last year, and expects to finalise a deal (or deals, if it sells parts off separately) by the end of Q2. Wolters Kluwer has indicated its education business, concentrated on European markets, is open to offers as well.

Crispin Davis, Reed Elsevier's wily CEO, knows that with three big businesses on the market, buyers have more negotiating power. It could mean that, while analysts estimate that the Harcourt business is valued in a range of £1.6bn to £2bn, Reed may see a return at the low end of that range.

But Reed won't mind that one little bit if, in turn, it dampens down buyers' enthusiasm to pay high for Thomson Education. Is Reed gambling that Thomson will suffer, too? That would be the corporate game in its most naked form.

According to the Financial Times, Davis has said the amount of money recently raised by private equity groups made it "a very positive environment" in which to sell, and private equity is now regarded as short-hand for City money being used to get the quickest short-term gain from a bunch of assets in declining or "mature" sectors.

Davis is reported to have said: "It's possible there may even be a synergy play here if you get Thomson Learning [as well]." But such a statement can be read two ways – anyone thinking of buying one division, may now be tempted by the other, and thereby be looking for a good price for both.

On the other hand, maybe Davis is inadvertently putting around an idea that will have great appeal to private equity firms – two significant players in the same market will have lots of potential overhead overlap. Bring the two assets together, ruthlessly strip out overhead costs, and sweat the business for the two or three good years it has ahead of it (by Davis' own calculations, by the way).

Such a scenario could have the effect of driving the price back up for both businesses by bringing in potential new buyers. So, by entering the market now, Reed Elsevier may have, in effect, helped drive up the price of the Thomson Learning business.

Unless, of course, insiders at Reed know that Thomson is too advanced with negotiations to benefit from the latest development. Then, Davis' words would be like daggers.