Education group Pearson is pressing ahead with restructuring by sealing the sale of its language teaching unit Wall Street English to a consortium of investors.
The former owner of the Financial Times said it had agreed to sell Wall Street English to private equity firms Baring and Citic Capital for $300million (£225million).
The sale, which is part of Pearson’s strategy to focus on its core education business and cut debt, follows the sale of Penguin Random House and Global Education earlier this year.
Wall Street English has centres in China, Italy and franchised centres across 27 territories
Wall Street English, which employs around 3,600 people, had a net debt of £1.3billion at the end of September.
Pearson said around $150million of operating cash will be retained in the disposed business while $50million will be used to cover tax and net transaction costs.
That means the improvement in Pearson net debt as a result of the transaction will be approximately $100million.
The new owners said they plan to expand in more cities across China and the world and that the deal will not result in the axing of any jobs.
Wall Street English currently has 70 teaching centres in China, nine in Italy and 321 franchised centres across 27 territories.
‘It’s business as usual for Wall Street English employees, partners and employees – nothing changes in terms of the day to day running of the Wall Street English business as a result of the sale.’ a spokeperson for BPEA said.
Wall Street English is an English language training network delivering English language learning to adults predominantly in Asia-Pacific through a blend of online and classroom study.
Pearson has been struggling recently due to a shift to digital from paper textbooks, especially in the US, and has issued a series of profit warnings – although last month it raised its profit forecast for the year.
Shares in the FTSE 100 listed group fell 1.7 per cent, or 12p to 695p in morning trading.
The deal is expected to close in the first half of 2018, subject to regulatory approval.
Pearson chief executive John Fallon said: ‘The sale of Wall Street English is part of our continued effort to focus on a smaller number of bigger opportunities in global education and to become simpler and more efficient.’
Pearson shares have had a torrid time over the past two years, and today are worth less than half their peak value of 1492p, achieved in early 2015.