Bertelsmann to Launch Education Activities Unit

VIENNA—--Bertelsmann SE on Thursday confirmed it launched a separate business unit for its education activities.

The new business unit's portfolio will include e-learning provider Relias Learning, Alliant International University and the company's stake in online education provider Udacity, among other assets.

The Wall Street Journal had earlier reported the German media, education, and service-provider company will announce the establishment of Bertelsmann Education Group—or BEG at a conference in New York, citing people familiar with the matter.

"In the medium term, we want to generate around one billion euros in revenues with the activities of Bertelsmann Education Group," Chief Executive Thomas Rabe said in a news release.

Bertelsmann, Europe's biggest media conglomerate, currently also owns brands including broadcaster RTL, magazine publisher Gruner+Jahr and service provider Arvato. It co-owns book publisher Penguin Random House with Pearson PLC.

For the past decade, Bertelsmann has been working to spread its owners' financial risk by diversifying its portfolio. As part of this new strategy, Bertelsmann has invested heavily in the education segment, in particular in online learning providers, while at the same time gradually selling off waning businesses such as printing.

In October 2014, Bertelsmann acquired Relias Learning for $540 million, its biggest acquisition in the U.S. since buying publisher Random House in 1998. In February, in what it said was a first step toward forming its own international university network, it invested in U.S.-based Alliant International.

Last week, the company was in initial talks to buy a minority stake in California-based university software and technical services provider HotChalk, people familiar with the matter said.

Kay Krafft, who has led Bertelsmann's education business since 2014, will become BEG's chief executive. BEG will, much like Bertelsmann's music rights unit BMG, be managed as part of the company's corporate investments division.

All of BEG's businesses will continue to operate under their own brands and names.

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(END) Dow Jones Newswires

September 10, 2015 07:15 ET (11:15 GMT)

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