Ac­tivist in­vestor tar­gets Pear­son board seat

The Daily Telegraph - Business - - Front Page - By Rachel Mil­lard

AC­TIVIST in­vestor Ce­vian has in­creased its stake in Pear­son to nearly 9pc, rais­ing ex­pec­ta­tions it will push for a seat on the board of the pub­lisher.

Europe’s largest ac­tivist in­vestor now owns 8.46pc of the FTSE 100 com- pany, up from 7pc two weeks ago and 5.4pc in June, mak­ing it the com­pany’s third big­gest in­vestor.

The Swedish com­pany be­lieves Pear­son has fallen short of its po­ten­tial un­der out­go­ing chief ex­ec­u­tive John Fal­lon, and is ripe for re­form as it shifts to­wards dig­i­tal ser­vices. Ce­vian is putting pres­sure on Pear­son at a vul­ner­a­ble time. It is yet to find a suc­ces­sor to Mr Fal­lon, who has over­seen a 56pc fall in the share price since tak­ing over in Jan­uary 2013, to 531p on Fri­day, and mul­ti­ple profit warn­ings. He has tried to fo­cus the com­pany on the ed­u­ca­tion sec­tor, sell­ing off the Fi­nan­cial Times and Pen­guin, but has strug­gled to make enough money out of dig­i­tal to make up for the slump in print pub­lish­ing.

Coron­avirus pushed Pear­son to a £23m loss dur­ing the first half of 2020, com­pared to a £144m profit dur­ing the same pe­riod the year be­fore, with rev­enue down 17pc. Ce­vian has said Mr Fal­lon’s suc­ces­sor should have a “clear track record of share­holder-value cre­ation”, sug­gest­ing it would not back an in­sider in the top job.

Pear­son said it was in “con­struc­tive and col­lab­o­ra­tive di­a­logue with Ce­vian”, as with other share­hold­ers.

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