Pearson plc: HOELT tender – what are risks/opportunities?

研报英文原文证据摘录

Pearson plc: HOELT tender – what are risks/opportunities?

Barclays | Pearson plc

to be considerable caution around using it for high-stakes testing given security risks. This

seems to us a thought-through, academic-style justification of the IELTS decision to pull out of

the tender.

IELTS may hope that expressing their concerns about the tender in this way may force a change

in approach, as concerns about security spread within the UK government. Or it may be that the

investment required to compete successfully was not appetising to management.

But the withdrawal did not seem to move the needle on the IDP Education (IEL.AX, not covered)

share price, implying, we think, that the impact of tests for work-related visas only would be

pretty small for IELTS volumes (and therefore for other players).

What different outcomes could there be for HOELT?

The following companies are privately held and are not under coverage by Barclays Research:

PeopleCert, Educational Testing Service (ETS).Information about these companies is being

provided for information purposes only and is not an investment recommendation by Barclays

Research.

Who are the runners and riders?

In order to compete for this tender as a single entity (not in a consortium), we think a player

needs to have a) good experience of running digital at-home testing and likely some

infrastructure already in place; b) a respected English language test; and c) an ability to

convince the UK Home Office that they can deliver a test that works for UK purposes. We look at

some existing players and where they fit within these parameters.

Pearson as a contender:

Positive: experience in language testing, trusted brand and a UK company

• Pearson Test of English was launched in October 2009. So it does not have the history of IELTS