The announcement that Pearson chief executive Marjorie Scardino is standing down early next has led to speculation the company could sell off the Financial Times.
Scardino is being replaced by John Fallon, the chief executive of Pearson's International Education division since 2008.
Investec analyst Steve Liechti said Scardino’s exit was “not a complete surprise”
While we expect no immediate massive change to strategy, we see speculation focusing in 2 areas – one bad, one good for share price….
1.) Bad – other highly rated top management have not got the top spot e.g. Rona Fairhead (FT Group), Will Ethridge (US Education) and John Makinson (Penguin) might all have wanted the top slot and could potentially leave.
2.) Good – Restructuring/asset sales/cash returns? We question whether Penguin/FT Group fit strategically, given PSON’s skew to education. Fallon is not a life-long publisher, so could be more brutal in his strategic direction in time, and shareholders would push for asset sales/cash returns in our view.