Pearson (LSE: PSON) (NYSE: PSO.US), the multinational publishing and education company, announced this morning that it had acquired Grupo Multi, the largest provider of private language schools in Brazil, for approximately £440m in cash and the assumption of £65m of debt.
The purchase of Grupo Multi, adds over 800,000 students, across more than 2,600 franchised schools, to the existing 500,000 students in K12 sistemas schools that Pearson already serves in Brazil, and the 600,000 English-language students at more than 600 Pearson operated or franchised centres around the world.
Brazil is already one of the world’s largest English-language learning markets, estimated to be worth £2bn, and a shortage of English speakers in key sectors — including tourism, transportation, and hospitality — is expected to drive growth in English-language learning as Brazil prepares to host high-profile global events including the World Cup next year and the Olympics in 2016.
Commenting on the acquistion, chief executive John Fallon said:
“Brazilians’ appetite for learning English as a global language of business and trade shows every sign of continuing to grow rapidly as Brazil becomes a global player in commerce, travel and a host of other industries.
“Over the past twenty five years, Grupo Multi has become the most respected English learning company in Brazil by offering high quality affordable English language learning that has made a real impact on the lives of its students. We intend to sustain and grow the business, helping many more young Brazilians to acquire the English language skills that will help them succeed in their careers.“
At its current 1,341p, Pearson’s share price is up close to 13% so far in 2013, and has grown 116% over the past five years. Pearson’s shares also stand on an estimated forward yield of around 3.7%.
