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Press Release
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18 January 2011
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PEARSON ACQUIRES TUTORVISTA: EXPANDS PEARSON'S BUSINESS IN EDUCATION IN INDIA AND IN GLOBAL ONLINE TUTORING
Pearson, the world's leading learning company, today announces that it has agreed to increase its shareholding in TutorVista to a controlling 76% stake for a consideration of $127m. Pearson acquired a minority stake in TutorVista in June 2009 and this transaction takes Pearson's total equity investment in the company to approximately $139m.
TutorVista was founded in 2005 by Krishnan Ganesh and is headquartered in Bangalore. The company has four main activities:
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Technology: TutorVista supplies digital content and technology platforms to private and government schools in India, typically under long term contracts. It currently serves approximately 3,300 classrooms;
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Online tutoring: it provides online tutoring services to approximately 10,000 students per month. It uses Voice-Over-Internet-Protocol and online whiteboards to connect instructors in India with school and college students, principally in North America, with developing opportunities across the globe;
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Test preparation and tuition: it operates a network of 60 centres across southern India delivering English language coaching courses for university entrance exams and out-of-class tuition to K-12 school children for SAT, ACT, AP and other exams; and
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K-12 schools: it provides a full suite of services including curriculum design, teacher training, technology solutions and school administration services to schools serving approximately 5,000 students in India.
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India's government currently invests $40bn each year or three per cent of GDP in education, while Indian consumers spend more than $40bn on private educational institutions and services. Both segments of the market are growing rapidly as a result of government commitment to increase the quality of and access to learning opportunities as a means of sustaining economic growth and reducing poverty.
This acquisition further supports Pearson's goals of building significant education companies in selected fast-growing markets and applying its learning services and technologies to support governments and institutions in making educational opportunities more accessible and more effective. TutorVista will be integrated into our education business in India and will enhance our presence in the school market in India and in tutoring across the globe in schools and higher education.
The acquisition follows recent investments in both acquisitions and organic growth opportunities in China, Brazil, Southern Africa and Nigeria.
Pearson expects the acquisition to enhance Pearson's adjusted earnings per share and return on invested capital in 2012, its first full year.
Marjorie Scardino, Pearson's chief executive, said:
"TutorVista is an innovative and effective education company that we have worked with and respected for several years. This acquisition - which we believe is the largest transaction in education in India by any company - signals our excitement about the vitality of India's education sector."
ENDS
For more information:
London:
Luke Swanson / Simon Mays-Smith / Charles Goldsmith
+44 (0)207 010 2310
Delhi:
Khozem Merchant
+91 (120) 4190 305
Pearson in India
Pearson has a longstanding and growing presence in India. Pearson Education is a leading publisher in the higher education and schools segment and in vocational training through our joint-venture with Educomp; Penguin Books India publishes the country's best-known authors including Shobhaa De, Nandan Nilekani and Amitav Ghosh; and The Financial Times has a leading position among global news organisations in its coverage of Indian economic and business affairs. More recently Pearson's professional testing business Pearson Vue established its Asia-Pacific headquarters in India, recognizing the potential of the market, and MergerMarket, a provider of high-value market intelligence for financial institutions, set up a bureau in 2007.