HBJ to Drop College Text Division, 115 Jobs in S.D. : Publishing: Publisher seeks to cut costs in wake of collapse of proposed merger with General Cinema.

Under pressure to cut costs after a proposed merger with General Cinema fell through last month, Harcourt Brace Jovanovich said Monday it is consolidating its college text publishing business in Texas, a move that will result in the loss of 115 jobs in San Diego.

The Orlando-based publishing and insurance company said it was merging its HBJ College division based in San Diego with its Holt, Rinehart and Winston College division based in Fort Worth. Ever since HBJ acquired the Holt, Rinehart and Winston publishing concern in 1986, the two college text divisions have been operated separately.

“More than half” of the 115 HBJ College employees in San Diego will be offered jobs in Texas and the rest laid off, spokesman Anson Franklin said Monday. The employees were told of the move Monday and it was not immediately clear how many would accept transfers. The consolidation is expected to be completed by September.

Prior to the reorganization, HBJ had 400 employees in San Diego, working in the HBJ College, Academic Press, HBJ Trade Dept. and Psychological Corp. units. None of the other divisions were effected by the move announced Monday. The company has 6,400 employees overall.

On April 26, a $1.4-billion tender offer for HBJ by General Cinema of Chestnut Hill, Mass, expired after the New England-based concern failed to come to agreement with HBJ bondholders. General Cinema offered severely discounted prices for the five classes of HBJ bonds outstanding.

HBJ has been in weak financial condition ever since it took on $2.6-billion in debt in a 1987 restructuring designed to thwart a takeover bid by British publisher Robert Maxwell. To regain its footing, the company has sold various assets, including its four Sea World theme parks to Anheuser-Busch in 1989 for $1.1 billion.

For 1990, HBJ reported a loss of $80.9 million on revenue of $1.4 billion. The company declined to break out revenues for its HBJ College unit but did disclose that its publishing revenue last year totaled $940 million.

“HBJ has to control its costs in every way, shape and form,” said Bert Boksen, chief investment officer at Raymond James & Associates investment firm in St. Petersburg, Fla. “It’s not a fiscally sound company right now.” Some analysts have said they do not expect HBJ, in its current fiscal state, to be able to pay off debt that is coming due in 1993.

HBJ’s Franklin said the timing of the restructuring has nothing to do with the failed tender offer with General Cinema and that the reshuffling has been in the works for eight months. The consolidation is being announced now so as to be completed in time for the fall college text selling season, he said.

In addition to shutting down the San Diego unit, HBJ said it will also move its Dryden Press editorial offices, a subsidiary of Holt, Rinehart and Winston College, based in Hinsdale, Ill., to Fort Worth. All of Dryden Press’ 52 employees will be offered jobs in Texas.