Rosetta Stone (NYSE: RST) plans to expand beyond its foreign language learning niche with its proposed acquisition of Lexia Learning Systems, a producer of interactive software to teach English reading skills to young students, Rosetta Stone announced today.
Rosetta Stone agreed to take over Lexia for $22.5 million in cash. This would be the second acquisition the company has made this year. In April, it paid $8.5 million for Livemocha, a large online language-learning company. Growth through acquisitions is the company's stated goal.
"This acquisition is another step in the transformation of Rosetta Stone," said company CEO Steve Swad in a statement. "We're moving beyond language; we're leveraging technology; we're growing our business in new and meaningful ways. And we're positioning this company to change the face of learning as we know it." The company says the transaction marks Rosetta Stone's first extension beyond language learning and "takes the company deeper into the EdTech industry."
Last month, Lexia was awarded a multiyear, multimillion-dollar contract to provide its cloud-based Lexia Reading Core5 program to thousands of pre-K through grade 5 Kansas students. Rosetta Stone says Lexia's English reading products are used in more than 14,000 schools and by more than 1 million students online.