Harcourt Expects to Close NEC Merger by Tuesday

IRVINE — Harcourt General Inc. took a big step toward acquiring National Education Corp., saying that 96% of the shares of Irvine-based NEC had been tendered by Wednesday’s deadline for the publisher’s offer.

Harcourt’s $21-a-share bid for NEC, agreed to by the two companies last month, was subject to a minimum of 90% of the shares being tendered. With that benchmark surpassed, Harcourt said it expects to complete the $811.6-million merger by Tuesday.

Based in Chestnut Hill, Mass., Harcourt is a giant of the publishing world, with its Harcourt Brace book unit. It has a strong presence in textbooks and professional materials but hopes the acquisition will give it added clout through NEC’s school supplement business, computer training unit and correspondence school division.

As previously announced, Harcourt plans to close NEC’s Irvine headquarters, resulting in the loss of up to 40 jobs. NEC’s operating units, all based in other states, will remain largely intact, and will report to Harcourt division heads.

Harcourt said it would begin paying for the tendered shares immediately. The remaining 4% of NEC shares will be converted into the right to receive $21 in cash.

Plagued by losses in the early 1990s, NEC became a takeover target after undergoing a dramatic turnaround in the past year and a half. In March, the company agreed to an all-stock acquisition by Sylvan Learning Systems Inc., a Baltimore operator of learning centers. Harcourt entered the contest and eventually won NEC with its $21-a-share cash offer.

The architect of NEC’s revival, Chief Executive Sam Yau, plans to leave the company after a transition period in which NEC’s finance, legal, human resources and other administrative functions will be incorporated into Harcourt’s corporate offices.

The transition is expected to occur in phases over the next several months, said NEC spokeswoman Connie McCluskey, and should be completed by the end of the year.