Reed Elsevier to Buy ChoicePoint for $4 Billion

International publisher Reed Elsevier announced today it would buy consumer identity specialist ChoicePoint Inc. for $4 billion, or $50 a share. London-based Reed Elsevier will also assume $600 million in ChoicePoint debt.

The price represents a premium of nearly 49 percent for ChoicePoint, according to a research note from investment house Lehman Brothers.

Reed Elsevier is a publisher of legal information, technical publications and magazines. It is in the midst of a three-year effort to cut operating expenses by $477 million. It reported it would merge ChoicePoint into its legal information power house LexisNexis to form a division with $1.5 billion in revenues.

Plans call for ChoicePoint to remain in its Alpharetta, Ga. headquarters. In 2007, it reported profits of $32.4 million on revenues of $982 million. ChoicePoint was hit with a highly publicized security breach in 2005. Last year it paid a reported $10 million to settle class action law suits arising from the breach, in addition to settling suits with 43 states.

Reed Elsevier announced the deal has been approved by ChoicePoint’s board but still requires shareholder and regulatory approval. The partners plan to complete the deal by the end of the year.