20th Sep 2023 10:18
(Alliance News) - Pearson PLC on Wednesday said it has recruited the head of Microsoft Corp's Industry Solutions business to be its new chief executive officer, in a move which may have caught investors unawares.
Omar Abbosh will replace Andy Bird early next year, who leaves after just three years in the hot seat at the London-based publisher of education materials. Bird, who spent 14 years at Walt Disney Co, joined the Pearson board as an independent non-executive director in May 2020 and moved to CEO in August of that year.
Sophie Lund-Yates, lead equity analyst at Hargreaves Lansdown, said: "In a move that should please investors, the announcement comes hand in hand with a smooth succession plan and the timing isn't one to set alarm bells off. Bird hasn't been in the top job for too long, but it's been long enough to oversee a significant transformation of Pearson's priorities in its bid to secure a more tech-focussed future."
That said, Pearson shares were down 3.5% to 853.00 pence on Wednesday morning in London.
interactive investor's Victoria Scholar said the sink in shares reflects "investor disappointment", however.
"Under his [Bird's] leadership, shares in Pearson have staged impressive gains of around 60%, reflecting his forward-looking vision for the company in terms of trying to position Pearson as a digital education provider for the future, switching away from old fashion textbooks. He's been trying to build the 'Netflix of education' through its Pearson Plus platform, a monthly pay-as-you-go online service for students," Scholar continued.
Scholar added that Abbosh, however, will "offer key experience in harnessing technology to Pearson's advantage".
As president of Microsoft's Industry Solutions business, Abbosh is responsible for sales and service for the US software maker's largest global customers. Prior to Microsoft, he worked for Accenture, including as chief strategy officer and as chief executive of the consultancy's global Communications, Technology & Media business.
Pearson "is at an exciting stage of its growth journey in markets that are increasingly digital," Abbosh said. "I look forward to building on the strategic growth opportunities, along with the leadership team, placing Pearson in the vanguard of lifelong learning."
Lund-Yates said: "Omar Abbosh's background in various tech leadership positions means the board is doubling down on plans to propel the education specialist into the next – very digital – chapter. While legacy declines in physical US course materials continue to be a hurdle that needs clearing, other efforts to drag its offerings online means performance has been steady of late."
By Sophie Rose, Alliance News reporter
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