January 18, 2011 / 9:16 AM / 7 years ago

UPDATE 1-Pearson raises stake in Indian online tutoring firm

* Picks up 59 pct in TutorVista for $127 mln

* Plans to raise stake to 80 pct in firm by Feb

* Currently focusing on mkts in India, China, Brazil (Adds details, quotes, background)

NEW DELHI, Jan 18 (Reuters) - British publishing group Pearson (PSON.L) bought a 59 percent stake in an Indian online tutoring services firm for $127 million on Tuesday, as part of its focus on fast-expanding emerging markets.

India's education sector, pegged at $86 billion, is seeing fresh interest from foreign firms and large funds who are pumping money into services, technology and infrastructure.

"India, China and Brazil are the focus now. We are spending hundreds of millions of dollars in these markets," John Makinson, chairman of Pearson India, told reporters.

Pearson, which had acquired a 17.2-percent stake in TutorVista in 2009, will now own 76.2 percent of the online firm. It plans to increase the holding to 80 percent by February.

"The acquisition gives us a platform to develop school learning in India," Makinson said.

The British educational technology provider and owner of Penguin Books and the Financial Times expects the deal to add to adjusted earnings per share in 2012.

Its move from a pure book publisher to the leading educational technology provider has enabled the company to gain market share in North America and helped improve results.

The Indian firm, which is currently valued at 9.6 billion rupees ($211 million), had raised $38 million in venture funding in the last four years.

Blended growth rate in Indian education services firms is seen at 21 percent over the next 12 months, according to ThomsonReuters StarMine smart estimates, outstripping the 18 percent growth forecast in the information technology sector.

Blended growth rate is the average of expected growth in earnings per share from last year to this year and from this year to next year alongwith the expected long-term growth rate. ($1 = 45.5 rupees) (Reporting by Anurag Kotoky and Rohan Dua; Writing by Nandita Bose; Editing by Ranjit Gangadharan)

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below