Santillana, owner of Moderna, speeds up growth in Brazil
Valor Econômico
Main unit of the Spanish editing group, Santillana Brasil ended last year with earnings of R$ 624 million (US$ 354.5 million) - which means anticipating in two years the disbursement foreseen for 2012. What puts Santillana Brasil ahead the other subsidiaries of the group in the world is the strong operation of its educational books publisher, Moderna. Responsible for nearly 60% of the earnings of Santillana, Moderna is one of the market leaders in textbooks generating nearly R$ 2 billion (US$ 1.2 billion).
The good result of the balance sheet of Santillana Brasil happens at a time of optimism for the publisher controlled by the Prisa group, which recently underwent a sharp financial crisis. "Now, we're working without hindrances. Before, we had difficulties to raise financings", said Sergio Quadros, Managing Director of Santillana Brasil for a year. The Brazilian operation is currently responsible for nearly 30% of the total earnings of the Spanish publisher that last year amounted to € 900 million.
This year, Santillana Brasil has plans to invest nearly R$ 25 million (US$ 14.7 million). Among its projects is the expansion of the teaching system Uno - target market of investors and editorial groups. "We want to expand our operation to Latin America. Today, we have nearly 130 thousand students using our system and in five years we want to increase such number to 500 thousand", said Quadros.
The good Brazilian performance has motivated the Prisa, owner of the newspaper "El País", to evaluate an IPO of the Santillana publisher in Brazil and in New York. "The project of an IPO is under study. The idea is to have the whole company going public, not just the Brazilian unit. We want to take advantage of the moment for IPOs and of the increasing demand for education in Brazil", said the Managing Director. Should the IPO project be approved, Santillana intends to resume the acquisitions to strengthen its operation. Since it landed in Brazil in 2000, the Spanish company invested R$ 170 million (US$ 100 million) in acquisitions, of Moderna among them. The last acquisition took place in 2005 with the purchase of the publishing house Objetiva. "At the moment, we are interested in smaller acquisitions, something in the areas of general literature or digital services. But should we choose the IPO, the idea is to make a greater acquisition", said the Executive of the group, which has a R$ 57 million (US$ 33.5 million) in cash.