Scotland's universities and colleges have signed a partnership deal valued at Pounds 3.54 million with News International to become a worldwide distance learning distributor.

Scottish Knowledge plc comprises 13 universities and eight colleges and has been marketing Scotland's home-grown distance learning around the globe since August 1997. The deal means that News International will own 25 per cent of Scottish Knowledge.

Worldwide Learning Limited (WWL), a subsidiary of TSL Education (publisher of The THES), will market and distribute the distance-learning courses and products.

Steve Beere, Scottish Knowledge's chief executive, said: "The substantial cash injection from News International, combined with the marketing expertise and scope of WWL, means Scottish Knowledge is now in a position to be a leading global player in the provision of distance learning."

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James MacManus, WWL managing director, said he hoped that the online marketing initiative would allow Britain's higher education market to expand into new territories.

Mr MacManus said: "Demand for undergraduate and postgraduate education is set to outstrip supply as governments - particularly in the developing world - seek to upgrade the education of their populations in order to compete in the knowledge economies."

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New markets to be targeted by the distance learning initiative include China, India, Latin America and the United States.

Sir Graeme Davies, principal of Glasgow University, said: "Together with Edinburgh University, we were original backers of Scottish Knowledge. I am sure that the universities will continue to play a key role in the company's future success."