Thomson sells Thomson Learning unit to SkillSoft.

In a possible prelude to the sale of all of the assets of Thomson Learning (Stamford, CT), Thomson Corp. has signed an agreement to sell its NETg (Scottsdale, AZ) Thomson Learning division, a provider of instructional content and consulting services, to SkillSoft (Nashua, NH), a provider of e-learning and performance support services for global enterprises, government, education and small to medium-sized businesses, for $285 million. The deal calls for SkillSoft to issue approximately 11.1 million SkillSoft ADSs and $216 million in cash. The cash portion will be financed through $36 million in available balances and $180 in financing from Credit Suisse.

NETg products are designed to help organizations optimize employees' abilities to respond and compete in the global economy. They are targeted to professionals in such fields as healthcare, telecommunications, manufacturing, pharmaceuticals, retail and financial services and offered to "deliver on bottom-line (client) imperatives such as regulatory, industry or technical certification, improved business performance, faster time to market, strategic advantage and effective competency and leadership development," NETg said. Netg had 2005 revenue of approximately $160 million with gross margins of about 72%. The company's e-learning content operations generated 74% of its revenue.

SkillSoft said the purchase will add to its existing offerings in e-leaning content, ReferenceWare and learning platform technology, through the addition of NETg's complementary offerings in live virtual ILT, blended learning and content authoring/LCMS (learning content management systems) technology, and supports the company's strategy to increase the quality and flexibility of learning solutions available to corporate, government, education and business customers. SkillSoft said the addition of NETg's capabilities will strengthen its ability to compete against larger players in the $13 billion corporate training market.

The sale closely follows a report in "The Wall Street Journal" that the whole Thomson Learning unit is in play. In the academic market, the unit serves secondary, post-secondary and graduate-level students, teachers and learning institutions in both traditional and distance learning environments. In the professional and corporate training market, the unit offers adult education and certification materials for corporations, training centers and individuals. Besides NETg, the unit includes Thomson Course Technology (Boston, MA), Thomson Delmar Learning (Clifton Park, NY), Thomson Gale, (Detroit, MI) Thomson Prometric (Baltimore, MD), Thomson South-Western (Mason, OH) and Thomson Wadsworth (Belmont, CA).