Pearson said on Friday it had rejected two takeover approaches from investment firm Apollo (APO.N), saying its latest $8.5 billion possible cash offer undervalued the global education group, which was confident in its own strategy.
Apollo’s earlier statement saying it was considering a bid sent shares in the British company up 22%, a welcome boost after it spent seven years navigating the switch from traditional learning to online, as students ditched textbooks.
Pearson said Apollo’s second “unsolicited, preliminary and highly conditional” 854.2 pence per share proposal, up from an initial 800 pence, significantly undervalued the company. The second offer values Pearson at 6.5 billion pounds ($8.5 billion).
“Accordingly, the board of Pearson unanimously rejected the second proposal,” it said in a statement.
Its shares were trading at 782 pence.
News of the approaches comes two weeks after Pearson set medium-term targets for the company for the first time in six years, believing it had turned the corner after changes in the industry hit its once thriving U.S. higher education courseware business, leading to a string of profit warnings.
Source: Reuters
