Houghton Mifflin Harcourt has decided against a renewed attempt to sell its consumer book arm, hoping to use the small division to bolster its core educational publishing business.

HMH, whose parent company last week announced a restructuring of its $7.6bn net debt load, is using its trade division’s links to retailers such as Amazon to distribute institutional products to the growing US home schooling market.

The number of American children being educated by their parents has doubled in the past decade, with at least 1.5m now being taught at home, often for religious or social reasons.

Rising economic stresses have fuelled speculation that home schooling will grow further as increasing numbers of parents find private schools unaffordable, although early evidence indicates that public schools have been the bigger beneficiaries.

The spread of digital teaching materials, both online and in the nascent e-book market, has helped parents construct syllabuses and made it viable for publishers to sell directly to the 3 per cent of children being taught at home.

“We’re taking some institutional products into the consumer market,” said Barry O’Callaghan, chief executive of Education Media and Publishing Group, HMH’s parent company. “Home schooling is growing nicely.”

EMPG had hoped to reduce debt by selling the trade and reference division, which publishes The Time Traveler’s Wife by Audrey Niffenegger and Philp Roth’s novels. However, it cancelled the auction this year when bids came in substantially below the about $300m it wanted.

Now, Mr O’Callaghan told the Financial Times: “We’re keeping [the unit]. It’s only 5 per cent of the business but it’s the DNA of the business. We’ve really tried to plug it in operationally.”

In turn, HMH has begun to sell children’s titles, such as the Curious George books, from the division to the school market.

Other publishers have pushed for synergy benefits between trade and educational businesses.

Pearson, owner of the FT, has integrated the distribution facilities for Penguin and its educational imprints, while Bertelsmann, which owns Random House, has examined possible acquisitions in textbook publishing.

Mr O’Callaghan said he was confident of a “very bright” future for the Cayman Islands-registered group after debt renegotiations lasting several months converted about $1bn of debt to equity and cut its interest bill by $100m a year to avert the risk of a Chapter 11 bankruptcy filing.

Federal stimulus funds were slowly beginning to flow, he said, after a year in which states’ plummeting tax receipts had cut spending on school textbooks by up to 30 per cent.

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