Pearson, the world’s leading learning company and owner of the Financial Times and Penguin Books, today announces that it has increased its shareholding in TutorVista, a fast growing Indian education company, to a controlling 76% stake for a consideration of INR 577 crore.
TutorVista was founded in 2005 by Krishnan Ganesh and is based in Bangalore. The company has more than 800 employees and a roster of 2000 tutors. It has four main activities:
1. Online tutoring: it provides online tutoring services to about 10,000 students each 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 world;
2. K-12 schools: providing a full suite of services including curriculum design, teacher training, technology solutions and school administration services to 11 schools serving approximately 5,000 students in India;
3. Technology: 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; and
4. 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.
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.”
John Makinson, Chairman of Pearson India, said: “Today’s acquisition underlines Pearson’s commitment to education and skills development in India. The investment in TutorVista gives us control of the world’s largest online tutoring business and, crucially, a solid platform on which to build a leading presence in the Indian private schools sector. As the future chairman of TutorVista, I look forward to working even more closely with Krishnan Ganesh and his extraordinarily talented team in Bangalore.”
*at current exchange rates
Krishnan Ganesh, Founder and CEO TutorVista, said: “We started TutorVista.Com to provide affordable education services and content globally. Together with Pearson, the world’s leading education company, we can make this happen even faster and help millions of students achieve their educational goals. TutorVista.com is already the largest consumer online tutoring company and with the help of Pearson we will now have an opportunity to take our high quality tutoring to schools and colleges directly.”
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. In mid-2009, Pearson established a joint venture with Educomp, India’s leading publicly-traded learning company, to develop vocational and professional services for the Indian market. This venture is running ahead of our expectations.
The TutorVista 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.
About Pearson in India
Pearson is a global media, education and publishing group, represented by market-leading businesses such as the Financial Times, Pearson Education and Penguin. These three business units have been operating in India for more than 20 years and, with more recent Indian entrants such as Pearson Vue and Edexcel, are all on a path of aggressive growth in the Indian market. Pearson employs about 800 people in India.
Pearson Education is an integrated educational services company providing high quality content, technology and services to schools, colleges and professional training organizations across the subcontinent. It covers 10,000 of the top schools in the country, providing textbooks, digital content, teacher training and clinical assessments. Pearson’s Edexcel division, a leading provider of internationally recognized academic and vocational qualifications, works with over 300 schools in the subcontinent, helping them to deliver the IGCSE and A level certificates. PEI also publishes textbooks for three state governments. Over 30 professional training organizations are delivering Edexcel’s BTEC Higher National Diploma. In Higher Education, PEI provides textbooks and e-learning materials to colleges across the country; its editors create original material as well as adapt international texts to better suit Indian students. PEI also translates international books into five major Indian languages, and creates customized solutions to institutions, including curriculum design and custom publishing.
Penguin Books India is the largest and most respected English-language consumer publisher in the subcontinent and publishes the country’s best-known authors including Shobha De and Amitav Ghosh. Separately, Dorling Kindersley, a leading publisher of reference and travel books, has, in the past three months added 100 people, taking its strength to 250 people in Delhi and positioning the India unit alongside the London headquarters at the heart of the DK network around the world.
The Financial Times has a leading position among global news organizations in its coverage of the Indian economy.
Pearson’s professional testing business Pearson Vue has 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 2005.
In 2008, Pearson Assessment set up its Clinical and Talent Assessment office in Bangalore, India, recognizing the need to make its assessment tools more accessible to the growing number of professionals in fields such as education, psychology, and human resources.
In 2009 Pearson formed a joint venture with Educomp, India's largest education company, IndiaCan, which focuses on vocational education and skill development, and also invested in Bangalore-based online tutoring and schools development company, TutorVista.
In the same year, Pearson launched Pearson Test of English – Academic, a computer-based test of English Language. The test is endorsed by Graduate Management Admission Council® (GMAC®).
Pearson is represented in India by Khozem Merchant, President - Pearson India.
TutorVista.com is the leading online tutoring company in the world providing affordable and high quality education to tens of thousands of students globally. Started in 2005, TutorVista.com has grown at a rapid pace with over 20,000 registered students in the U.S and U.K and other countries and over 2000 teachers employed across India today.
TutorVista.com’s mission is to make world class education affordable and accessible. It addresses the Indian market through Manipal K 12 Education (formerly Edurite Technologies). Edurite is the leader in the field of technology enabled education in India and has carved a niche for itself in the education space over the last 10 years. Founded in 2000, Edurite's core business is in providing curriculum based digital content solutions for teachers, students, parents and administrators. Edurite is an established player in ICT, tutorials and schools business and has won many awards showcasing its excellence and commitment to education.
Started by serial entrepreneur Krishnan Ganesh, TutorVista.com has been backed by marquee investors such as Sequoia Capital, Lightspeed ventures, Pearson and Manipal Group. TutorVista’s unique business model is a subject of case studies in leading management schools and features in management books as an example of pioneering innovation through disruptive business model.