ELE.L Regulatory News (ELE)

6 Jun 2005 07:01

Electric Word PLC06 June 2005 June 6th 2005 Electric Word plc ("Electric Word" or "the Company") Acquisition of Fieldwork Online Training Strengthens Public Sector Management Information Portfolio Electric Word, the specialist information publisher, today announces theacquisition of the business and assets of Fieldwork Online Training ("FOT"), theschools management e-learning division of Fieldwork Education Limited ("FEL").The all-cash consideration comprises an initial payment of £249,000 and afurther performance-related cash payment depending on sales in 2005-6. Thetotal deferred consideration payable is expected to be between £150-200,000 andis capped at a maximum of £400,000. FOT supports the professional development of school managers in the UK andabroad with a suite of online training courses and a bespoke e-learningplatform. The business is highly complementary to Electric Word's currentportfolio of education information products including CPD Update, itslongest-established continuing professional development newsletter for schools.FOT has site licences in over 200 schools and will benefit from access toElectric Word's existing customer base including senior managers in 98% ofsecondary schools in England and Wales. The acquisition will further enhance theCompany's renewable subscription-based revenues and its capacity for organicgrowth. This fits well with Electric Word's strategy of combining organic andacquired growth. In the year to April 2005, FOT generated revenues of approximately £305,000(unaudited) from a combination of direct sales of site licences to schools andleasing the e-learning platform to larger partners such as the Education andManpower Bureau in Hong Kong and the University of Cambridge InternationalExaminations syndicate. The average revenue from new direct site licence salesin 2005 has been over £1,000. Following marketing, sales and content investmentby Electric Word in the first year of ownership, FOT is expected to be earningsenhancing in the second year and thereafter. Investment in Continuing Professional Development (CPD) for teachers is at theleading edge of the Government's education strategy for the next five years. Anew schools inspection regime starts in September 2005 which is founded on anassessment of a school's ability to self-evaluate and prioritise professionaldevelopment needs. Also in September of 2005, the Teacher Training Agency is tobe re-structured as the Teacher Development Agency, putting greater emphasis onthe professional development of already-qualified teachers. Commenting on the acquisition, Julian Turner, Chief Executive of Electric Word,said: "Fieldwork Online Training is an ideal acquisition for us to bolt on to ElectricWord's public sector management information business. It will broaden the rangeof existing and new products we can cross-sell to established schools customersand allows us to benefit further from the Government's commitment to invest inimproving professional standards in education. "The acquisition strengthens our position in the fast-growing and strategicallyimportant area of electronic delivery in professional development. I am alsodelighted that FEL will continue to work with Electric Word as a sales agent andpartner in the future development of the business." E-learning is a rapidly expanding part of the distance learning and professionaldevelopment training market. According to the EU's Directorate-General forEducation and Culture, e-learning expenditure as a percentage of total workplacetraining doubled in size in five years from 10% in 2000 to 20% in the currentyear. The EU predicts that the public sector e-learning market could currentlybe worth €3bn (£2bn). The UK is expected to be the market in Europe withgreatest opportunity for development as suppliers build upon its Englishlanguage advantage. Notes to Editors Electric Word is a specialist information company, made up of two divisions:Public Sector Management Information and Sport and Specialist Consumer. ElectricWord employs many formats, including newsletters in both paper and electronicmedia and conferences, books and special reports. It has a particular strengthin renewable subscription products, which accounted for 72% of turnover lastyear. Enquiries: Julian Turner, Chief ExecutiveElectric Word plc020 7954 3470 Tim Spratt / Kim MuckleFinancial Dynamics020 7831 3113 Richard SwindellsPanmure Gordon & Co020 7459 3600 This information is provided by RNS The company news service from the London Stock Exchange