|
18th December
2019
|
|
|
Pearson,
the world's learning company, today announces an agreement to sell
its remaining 25% stake in Penguin Random House to partner
Bertelsmann SE & Co KGaA ("Bertelsmann") for a consideration of
approximately $675m / (£530m). The transaction is in line with
Pearson's simplification strategy.
This
transaction values the Penguin Random House venture at an
enterprise value of $3.67bn, compared with the $3.55bn enterprise
valuation in 2017 when Pearson sold a 22% stake in the joint
venture.
The
disposal is subject to regulatory consent and is expected to close
in the first half of 2020 and therefore will have no impact on 2019
results. Pearson is committed to its disciplined approach to
capital allocation and in early 2020 will commence a return of
capital to shareholders through a £350m share buyback. Shares
repurchased will be cancelled. The remainder of the proceeds will
be used for general corporate purposes.
The
formation of Penguin Random House in 2013 created the first truly
global consumer book publishing company, with a significant market
presence, generating synergies through the integration process and
creating significant shareholder value. Our stake2 in Penguin
Random House will have generated c.£1.9bn in net disposal
proceeds and dividends.
Pearson
owns 25% of the Penguin Random House venture which in 2018 reported
revenue of $3,703m and EBIT of $467m as reported in €
converted at a 2018 average €/$ exchange rate of 1.18, gross
assets of $4,407m and net assets of $1,166m converted at a 2018
closing €/$ rate of 1.15. In 2018, Pearson's 25% associate
share in the venture contributed £68m after tax to its
adjusted operating profit.
John Fallon, Pearson's chief executive, said: "For almost 50
years, Pearson has been proud to play our part in the publishing
and commercial success of first Penguin and then more recently
Penguin Random House. With the sale of our remaining stake to our
partners, Bertelsmann, we know the company is in good hands - and
we wish our colleagues and authors every future success. This
enables Pearson now to be completely focused on building the
world's leading digital learning company, linking education to
employability and skills, and reaching more learners around the
world to support them through a lifetime of learning."
Notes:
1 Based on guidance $/£ exchange rates of
1.27.
2 47% stake held between
1st July 2013 and 5th October 2017, 25% stake held from
6th October 2017.
For more information
T + 44
(0)20 7010 2310
Investors:
Jo Russell, Anjali Kotak
Press:
Tom Steiner, Gemma Terry
This
announcement contains inside information
Ends
Forward looking statements:
Except for the historical information contained herein, the matters
discussed in this statement include forward-looking statements. In
particular, all statements that express forecasts, expectations and
projections with respect to future matters, including trends in
results of operations, margins, growth rates, overall market
trends, the impact of interest or exchange rates, the availability
of financing, anticipated cost savings and synergies and
the execution of Pearson's strategy, are forward-looking
statements. By their nature, forward-looking statements involve
risks and uncertainties because they relate to events and depend on
circumstances that will occur in future. They are based on numerous
assumptions regarding Pearson's present and future business
strategies and the environment in which it will operate in the
future. There are a number of factors which could cause actual
results and developments to differ materially from those expressed
or implied by these forward-looking statements, including a number
of factors outside Pearson's control. These include international,
national and local conditions, as well as competition. They also
include other risks detailed from time to time in Pearson's
publicly-filed documents and you are advised to read, in
particular, te risk factors set out in Pearson's latest annual
report and accounts, which can be found on its website
(www.pearson.com/investors). Any forward-looking statements speak
only as of the date they are made, and Pearson gives no undertaking
to update forward-looking statements to reflect any changes in its
expectations with regard thereto or any changes to events,
conditions or circumstances on which any such statement is
based. Readers are cautioned not to place undue reliance
on such forward-looking statements.
|
|
|
|
PEARSON
plc
|
|
|
|
|
Date: 18
December 2019
|
|
|
|
By: /s/
NATALIE WHITE
|
|
|
|
|
|
------------------------------------
|
|
|
Natalie
White
|
|
|
Deputy
Company Secretary
|