Sanoma has signed an agreement to acquire Santillana Spain, a leading Spanish provider of K-12 learning materials, from Promotora de Informaciones S.A. (Grupo Prisa). With this acquisition, Sanoma significantly expands its position in the Spanish K-12 learning services market, which is one of the largest in Europe. Net sales of the acquired business were EUR 128 million and pro forma adjusted EBITDA was EUR 50 million in 2019, which was the peak year of the current curriculum. During the current curriculum in 2016–2019, Santillana Spain’s annual net sales were EUR 122 million, and operational EBITDA EUR 48 million on average. The agreed enterprise value of the acquired business is EUR 465 million, corresponding to a multiple of 9.3 (EV / Pro forma adjusted EBITDA 2019). The transaction is expected to be finalised during H1 2021.
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Strategic rationale of the acquisition: A significant step in growing Sanoma’s learning business in Europe
With the acquisition of Santillana Spain, Sanoma obtains a leading position in the learning content market in Spain, where it already operates in learning content distribution as well as in digital platforms for teaching and administration through Iddink Spain and Clickedu, both acquired in 2019. Spain is one of the largest educational markets in Europe with 6.4 million students in primary, secondary and vocational education, and an annual spend in K-12 learning materials of approx. EUR 600 million, including both public and private funding. The Spanish K-12 learning content market has proven to be resilient throughout economic cycles as well as during the ongoing coronavirus pandemic. Santillana Spain operates in all educational regions in Spain, which is a relatively fragmented market partially due to its 17 educational regions, each running its own curriculum.
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“I am very pleased to announce our acquisition of Santillana Spain, a leading provider of learning materials in Spain and a company with an experienced, long-standing and dedicated management team. This acquisition is a strong next step in Sanoma’s strategic transformation into a growing European learning company and a leading cross-media company in Finland. It will grow Learning’s share of the Group’s earnings (operational EBIT excl. PPA) from 55% to over 65% and further strengthen our cash flow generation capabilities,” says Susan Duinhoven, President and CEO of Sanoma. “We see great potential in the Spanish market, related not only to the upcoming curriculum renewal expected to be implemented in 2022–23 but also to increasing digitalisation, which has been further stimulated by extensive use of remote learning during the coronavirus pandemic. We are planning to use our solid experience in highly digitalised countries and our digital platforms developed over the past 10 years to accelerate growth of Santillana Spain over time,” she continues.
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