THE FTSE 100’s first female chief executive Dame Marjorie Scardino stepped down as head of Financial Times owner Pearson yesterday, after more than 15 years in charge.
Scardino, who has transformed Pearson since she took charge in 1997, will be replaced by the head of the firm’s successful education unit John Fallon. The move sparked speculation that Pearson may look to sell the FT Group, which also includes a 50 per cent stake in The Economist.
Fallon is perceived as far more likely to sell the FT Group and book publisher Penguin in order to focus on Pearson’s more profitable education divisions. Scardino had famously declared that the FT would be sold “over [her] dead body”.
Ian Whittaker of Liberum Capital said yesterday: “Ms Scardino was a big fan of the FT and resisted attempts to sell the business. We see John Fallon as having no emotional commitment to the division.” Whittaker added that the FT would be an attractive “trophy asset” and that Bloomberg would be the most likely buyer, although a sale was unlikely in the short term.
Fallon emphasised his commitment to the FT yesterday, saying: “I very much recognise and value the FT as an important and valuable part of the company.” He said that the FT’s strategy fits in with Pearson’s own, although he did not rule a sale out. The FT Group is valued at around £750m.
Shares in Pearson fell slightly yesterday on fears that a number of executives passed over for the job would leave the firm.
Pearson turns a page with a change of CEO
WHEN Marjorie Scardino became chief executive in 1997, Pearson had an eclectic mix of assets, including Madame Tussauds and parts of Channel 5 and BSkyB. The first female FTSE 100 chief executive, she consolidated the company’s operations, and expanded education – now Pearson’s most lucrative business. Having come from The Economist Group – 50 per cent owned by Pearson – the Texan was fiercely loyal to the newspaper and magazine operations, famously declaring in 2002 that the FT would be sold “over my dead body”. Despite her history in traditional media, Scardino radically altered Pearson in her 15 years, embracing digital publishing and education. She became a dame in 2003 after taking British citizenship.
JOHN Fallon will become chief executive after 10 years at Pearson’s education business. In 2008, he took charge of the fastest growing part of Pearson, the international education division, where he has almost doubled sales and expanded into new markets, making acquisitions in Brazil, China and Africa. Fallon joined Pearson in 1997, the same year as Scardino, when he was appointed director of communications. The 50-year-old is seen as far less emotionally attached to the FT Group and Penguin, although analysts suggest that having been part of the company’s upper management for several years, a significant change of direction from Fallon is unlikely.
Before Pearson, he was director of corporate affairs at Powergen.