OMERS Private Equity (OPE) manages a diverse portfolio that consists of fund relationships and a growing number of direct investments. One direct investment is Nelson Education Ltd., Canada’s leading educational publisher. They were acquired in a joint venture by OPE and Apax Partners in July 2007.
OMERS Retired Member News spoke with Paul Renaud, President and CEO of OMERS Private Equity and James Reeve, Vice President, Higher Education, Nelson Education Ltd., to learn more about this investment and what it means for OMERS.
What makes Nelson Education a valuable asset?
Paul: Nelson Education has many of the characteristics we look for in our investments. As the #1 Canadian academic publishing house, they are in a leading market position with strong fundamentals for growth and opportunities to enhance value.
Nelson’s talented and dedicated management team and staff are a solid force behind the company’s success. The team fosters great relationships with their authors and professors to continually produce the highest quality educational products and services.
The combination of these qualities ensure that Nelson is a valuable addition to OPE’s portfolio.
What type of material does Nelson Education publish?
James: We work with more than 4,500 authors and thousands of educators across the country, and publish a wide variety of print and electronic resources. This includes kindergarten literacy books, high school textbooks, post-secondary resources and trade publications on topics ranging from anatomy to zoology.
We also support French language learning markets and have a strong relationship with Cengage Learning, our U.S. affiliate company.
How did this partnership begin?
Paul: OPE was approached by Apax Partners, a private equity investment group we have been investors in, to be an investment partner for this acquisition.
Nelson Education is 100% Canadian owned, and is a cultural property under Heritage Canada. Because of this, a Canadian buyer was a necessary part of the sale. After extensive research to gain insight into the company, understand the publishing business and identify the key drivers of growth, we felt this was a strong and secure investment for OPE to make.
OPE is the majority investor in Nelson’s Canadian business, while Apax is the majority stakeholder in Cengage Learning, Nelson’s U.S. and international publishing business.
How stable is this investment, given the volatility in the economy?
Paul: Nelson Education has very stable market dynamics. To a certain degree, the academic publishing industry is recession-proof.
One reason is due to the Canadian government’s continuous support, emphasis and funding into the education system. The concentration on our children – Canada’s future workforce – is consistently a high-priority item on every government’s platform.
It’s also interesting to note that during periods of economic downturn, enrolment in higher education actually increases as people return to school for additional training.
James: There is an ongoing focus on Canada’s education system in times of recession or boom. The demand for school books and learning resources will continue, as will Nelson Education’s support of all learning initiatives.
Our superior working relationships with authors and educators help maintain our stability and long-term growth as well.
Once educators adopt a textbook, they often build their course curriculum around the resource. Typically, this curriculum is used for many years. We will continue to work closely with our clients to keep their material current with revisions and new editions, and use their feedback to build the best learning tools for their students.
What’s does the future have in store for Nelson Education?
James: We are adapting to Canadians’ interest in technology, and are focusing on customizing our products based on diverse student interests and needs. For example, we are creating more electronic and online supplements as an alternative to our print resources. This may include online study guides to complement textbooks and/or interactive electronic versions of books (e-books) with embedded study questions.
To learn more about:
OMERS Private Equity, visit www.omerspe.com.
Nelson Education Ltd., visit www.nelson.com.
