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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 UNDER
THE SECURITIES EXCHANGE ACT OF 1934
For the
month of February
2019
PEARSON plc
(Exact
name of registrant as specified in its charter)
N/A
(Translation
of registrant's name into English)
80 Strand
London, England WC2R 0RL
44-20-7010-2000
(Address
of principal executive office)
Indicate
by check mark whether the Registrant files or will file annual
reports
under
cover of Form 20-F or Form 40-F:
Form
20-F
X
Form 40-F
Indicate
by check mark whether the Registrant by furnishing the
information
contained
in this Form is also thereby furnishing the information to
the
Commission
pursuant to Rule 12g3-2(b) under the Securities Exchange Act of
1934
Yes
No X
18th February
2019
London
Press Release
Pearson makes further progress on its simplification strategy with
the sale of its US K12 courseware business.
Pearson today completes another major milestone in its
simplification programme with the announcement of the sale of its
US K12 courseware business to Nexus Capital Management LP (Nexus)
for headline consideration of $250m. Total proceeds comprise an
initial cash payment of $25m and an unconditional vendor note for
$225m expected to be repaid in three to seven years. Following the
repayment of the vendor note, Pearson is entitled to 20% of all
future cash flows to equity holders and 20% of net proceeds in the
event the business is sold. This additional consideration has been
structured to provide Pearson with the potential to capture future
upside in the US K12 courseware adoptions market over the coming
years.
This disposal is an important part of our ongoing work to become a
simpler and more efficient company, focused on fewer, bigger
opportunities that contribute towards growth and our digital
transformation. It will greatly simplify our ongoing technology,
systems and office rationalisation. The broader US K12 market
remains an important area of focus for Pearson and we are
continuing to invest in faster growing digital services such as
virtual schools and building on our strong position in US student
assessment. We will continue to provide Higher Education
courseware for Advanced Placement programmes in K12
schools.
Pearson's US K12 courseware business provides textbooks and
instructional resources to help teachers and students at every
stage of K12 learning in the United States. It employs
approximately 1,330 people. The US K12 courseware business had
gross assets of £648m and net assets of £75m as at 31
December 2018 and generated around £364m of revenue and
approximately £20m1 of
adjusted and statutory operating profit in
2018.
The transaction is expected to complete at the end of the first
quarter of 2019 and cash proceeds generated in due course will be
used for general corporate purposes.
John Fallon, Pearson's chief executive, said:
"School publishing in America has been an important part of Pearson
for many years, and what it does matters to teachers and students
across the country. We're pleased to have found new owners who are
committed to its future, and we wish it every success. The
sale frees us up to focus on the digital first strategy that will
drive our future growth. Through our assessment, virtual school,
advanced placement and career and technical education programmes,
we will still serve schools across America and we will now be
better placed to focus on the areas in which we can best help their
students to be successful in their studies and future
careers."
Barclays and Citi acted as financial advisors and Morgan, Lewis
& Bockius acted as legal advisors to Pearson on this
transaction.
Kirkland & Ellis acted as legal advisor to Nexus on this
transaction.
Notes:
1. Statutory adjusted operating profit post IFRS15. This equates to
around £11m of profit pre IFRS15.
About Pearson
Pearson is the world's learning company, with expertise in
educational courseware and assessment, and a range of teaching and
learning services powered by technology. Our mission is to help
people make progress in their lives through learning. We believe
that learning opens up opportunities, creating fulfilling careers
and better lives. For more, visit: www.pearson.com/corporate.
About Nexus Capital Management LP
Nexus is an alternative asset investment management company based
in Los Angeles, California that was founded in 2013. Nexus
employs a flexible investment mandate that focuses on long-term
value creation by partnering with leading management teams and
businesses.
For more information on Nexus, please
visit www.nexuslp.com.
This announcement contains inside information
For more information
T: + 44 (0)20 7010 2310
Investors: Jo Russell, Tom
Waldron, Anjali Kotak
International media: Tom
Steiner
US media: Laura Howe +1
202 748 3284
Ends
SIGNATURE
Pursuant
to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.
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PEARSON
plc
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Date: 18
February 2019
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By: /s/
NATALIE WHITE
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Natalie
White
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Deputy
Company Secretary
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