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Macmillan Education to move out of Africa

29.07.11 | Benedicte Page

Macmillan has “walked away” from its education business in east and west Africa, and is understood to have put all its education publishing companies and interests across the continent (other than in Botswana) on the block.

The development comes in the wake of the corruption case which last week cost Macmillan £11.3m in a civil settlement with the Serious Fraud Office. New anti-bribery legislation affecting international business also came into force in the UK earlier this month.

Macmillan’s massive payout came in recognition of “unlawful conduct” after an investigation which was prompted by a World Bank report of an agent attempting bribery to obtain a tender to supply educational materials in Sudan. The SFO then investigated Macmillan’s other contracts in Rwanda, Uganda and Zambia, concluding that it was impossible to be sure the tenders had not been gained via a “corrupt relationship”. The £11.3m settlement was decided on as being a sum that would cover all potential unlawful revenues that the company had received.

Macmillan has been barred from participating in World Bank-funded business for three years. Last week it also announced it had decided to stop all public tenders in its education business in east and west Africa, whoever the funder was. A Macmillan press spokesperson said the publisher “had essentially walked away from its education business” in those countries.

Macmillan currently owns, or has a stake in, companies in 15 African countries, including Ethiopia, Gambia, Ghana and Mozambique. Macmillan Kenya was sold in a management buyout at the end of 2010. The publisher is thought to have been actively seeking buyers for all its African education interests for the past year. Macmillan said: “We don’t comment on any of our specific businesses regarding strategic plans.”
The Bribery Act, which came into force on 1st July, means any bribery offences committed by an employee or representative of a British company, wherever that offence is committed in the world, can result in a prosecution in the UK. The company, its senior executives and employees can all be found liable, and ignorance on the part of management is not considered a defence.

* Last month, Pearson Education UK sold its 51% equity holding in Longman Nigeria, which it established over 50 years ago. Pearson will instead open a new company in Nigeria later this year. The development comes only three years after Pearson increased its interest in Longman Nigeria, acquiring an additional 22% stake in the business. A Pearson spokesperson said: “We looked at a variety of issues—growth factors, synergies with other parts of Pearson—and felt majority control was not as advantageous and efficient as outright ownership.”

• Annette Thomas
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