With Harry Potter done, is it time for Scholastic to sell itself?

It might seem hard to imagine, but the success of the Harry Potter franchise over the past decade has done little to bolster the fortunes of its publisher, Scholastic (NASDAQ: SCHL). With a market cap of $1.4 billion, the company may not be worth much more than the book's author J.K. Rowling.

But with Harry Potter on the way out as a huge source of income (although residual sales will, of course, continue to be strong), Bloomberg believes that the company "may face an exodus of shareholders if the company doesn't consider selling itself."

The stock looks cheap at .66 times sales the Bloomberg piece quotes analyst Drew Crum saying that shares could be worth a 48% premium to their current price if the company is sold.

But that means nothing if management doesn't want to sell, and CEO Richard Robinson controls the company through his ownership of Class A shares.

The most appalling quote from the Bloomberg piece is here:

Robinson, whose father Maurice founded the company in 1920, ``is not a seller,'' Chief Financial Officer Maureen O'Connell said in an interview. Through its ownership of Class A shares, the Robinson family controls four-fifths of Scholastic's board.

``I don't think Dick's going anywhere,'' O'Connell said. ``He's having too much fun right now.''

If Mr. Robinson wants to run the company for fun rather than the benefit of minority shareholders, he should take the company private himself.

Keep a close on this stock. If Scholastic continues to stumble, Robinson could face pressure to do the right thing and enhance shareholder value.

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