Strategic Developments of Pearson Education

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Strategic Developments of Pearson Education

This research has gathered information on major acquisitions, divestments, and major strategic partnerships by Pearson Education over the last 5-10 years. Their acquisitions include Integrated Analytics LLC, Author Solutions, Global Education & Technology Group, Grupo Multi; the divestments include PowerSchool, Pearson Affordable Learning Fund (PALF), US K-12 Business, Wall Street English, FT Building, and Financial Times; and their partnerships include Duolingo and three online schools. Information on Pearson Education entering new countries or exiting others was not readily or publicly available. Below is the information on the various activities within the past 5-10 years and the research strategies.

Methodology

To answer the request fully, we had to find the major acquisitions, divestments, major strategic partnerships, and information on whether the company is entering new countries or exiting others. To conclusively answer the request, we defined the term “major” as something that has changed the shape or direction of the company. The focus of the search was on acquisitions and partnerships necessary for the restructuring of the company. The restructuring of Pearson as a digital-focused education company started in 2013. This influenced the choice of major strategic partnerships and major acquisitions.

For acquisitions, divestments, and strategic partnerships, we searched through various sources. These sources included the company’s website and financial reports, reputable media articles from sites such as Ed Surge, Fox News, New York Times, Financial Times, The Guardian and PR News, and different company profile databases such as Crunchbase, LinkedIn, and Pearson’s Database. Using the restriction for the aspect of “major,” we identified acquisitions and strategic partnerships.

The fourth section of our question required us to list the new countries that Pearson Education entered and those they left within the past five to ten years. Unfortunately, this information was not readily available. These are the research strategies attempted that were unsuccessful in getting this information.

To answer this part of the request, the first research strategy was to search the company’s reports for the various years to find any information or mention of exit or entry into a country. We searched through the financial publications of the company. Financial reports would help give us reasons for the reduction in overhead costs and increased profits. During the search, we found no information detailing the countries or country that Pearson had entered or exited. Instead, there was only mention of new partnerships within countries they are already in, such as the Ubongo program in Tanzania and others in Mozambique. We attributed the increase in profits to restructuring the company by reducing the employee number and exiting the LMS market. Unfortunately, no mention of the countries or country that Pearson had entered or exited in the last five to ten years were readily available.

Our second research strategy was to search through press releases and news articles from reputable media sites such as the New York Times, Financial Times, The Guardian, and PR News. The aim was to find mention of new entries or exits within the past five to ten years. However, the obtained information was the exit of the company from the LMS market, but there was no mention of exit or entry into a country.

Our third strategy was to search through several company databases that hold information and have company profiles. Such sites include Crunchbase, Pearson’s Database, Ed Surge, and LinkedIn. Although we searched extensively for any information on exits and entries, this information was not readily or publicly available.

1) MAJOR ACQUISITIONS

In 2016, Pearson acquired Integrated Analytics LLC. This acquisition establishes a stronger integration of StatCrunch and MyStatLab and leveraged a long-term collaboration with Dr. West. In 2012, Pearson acquired Author Solutions at $116 million and Global Education & Technology Group (GETG) at $294 million.

Pearson acquires 100% Grupo Multi, a company in Brazil that is pioneering training of the English language, by buying it off from the various shareholders at £440 million, equivalent to approximately $573 million. (16,19)

This specific acquisition plays right into Pearson’s strategy of focusing investment in fast-growing economies that have digital and services business, and education programs that are intentionally impacting their communities. This acquisition will support Pearson’s Wall Street English-language schools in the country of Brazil by providing Multi’s products and services, and scaling it further in the region, with a global scope in sight, by targeting middle class across various economies.

2) DIVESTMENTS

In 2015, Pearson sold PowerSchool to Vista Equity Partners at $350 million. They made this all-cash deal even though this subsidiary was still profitable to align all efforts to its new mission. In the same year, they invested $50 million in the Pearson Affordable Learning Fund (PALF) and geared it toward supporting educational projects in developing countries. They also invested $2.2 million in HarukaEd, in Indonesia, which enabled higher education institutions to scale up their online degree programs.

In 2019, Pearson sold US K-12 Courseware Business for $250 million over seven years. In 2017, Pearson sold its English-language teaching business, Wall Street English, after there was a sign of instability in the profit records of the previous year. Pearson sold the FT building and corporate headquarters at £115 million, which is approximately $150 million in 2018. By 2015, Pearson had sold the Financial Times to Japan’s Nikkel.

3) MAJOR STRATEGIC PARTNERSHIPS

In 2018, Pearson partnered with Florida Connections Academy (FCA), Lighthouse Connections Academy (LCA) in Michigan, and Great River Connections Academy (GRCA) for their online learning platforms. These partnerships sought to provide quality education to anyone, anywhere.

Duolingo is one of the best mobile language apps. A partnership with Pearson would be ideal for higher education students. This app will be a great complement to the existing curricula by ensuring increased interaction with the students, which enhances their growth.

Sources
Sources

Quotes
  • "The sale of PowerSchool, an administrative system rather than a tool for learning, teaching or assessment, will enable us to focus more directly on learning outcomes, and further simplify Pearson as we make our products more global, digital and scalable"
  • "it became clear that it was going to be difficult for Pearson to continue investing in our business when they could be investing in things that are better aligned to their new mission"
  • "Like every market out there, the SIS market will consolidate around a couple of major players"
  • "The customers who are on older platforms will eventually move on. They are realizing that they are getting left behind and not getting technology and state reporting updates"
Quotes
  • "We are excited to invest in HarukaEdu and work with them to help low- and middle- income learners in Indonesia improve their employability prospects and income potentia"
Quotes
  • "The sale must be a relief [to Pearson] … Maybe tighter focus will help them turn the corner."
  • "I think we have a very good K-12 courseware business and we’ve continued to invest in it"
  • "The sale frees us up to focus on the digital-first strategy that will drive our future growth"
Quotes
  • "We live and work in a world in which we are surrounded by statistics; a welter of statistics to process, sort through and use to make sound decisions. Statistical reasoning skills have never been more important, and StatCrunch, developed by Dr. West and his team--long-time and trusted partners--is an unmatched application in developing these skills for today's students"
Quotes
  • "Working in partnership with Kevin Weiss and his team at ASI for the past five years has been a great experience for the Bertram team"
Quotes
  • "Through organic investment and complementary acquisitions, we're learning a lot about the very significant growth opportunities we see in China and about the value of combining our content and technology with high-quality school networks"
Quotes
  • "As the landscape of learning shifts and evolves, we are thrilled to partner with the Governing Boards of three new online schools in the United States"
  • "Providing school options that meet the needs of the modern learner is crucial to students with diverse preferences and needs, and we are encouraged by the successes we have seen so far"
Quotes
  • "It engages them in the out ­of­ class practice that is necessary to efficiently acquire that language"
  • "By combining the curriculum expertise of Pearson with Duolingo’s gamified teaching methods, we hope this partnership will set a new standard for the future of higher education"