February 21, 2024


education gives you strength

Baltimore-based Laureate Education to sell off South American universities, Walden University

Baltimore-based Laureate Education Inc. is selling off much of its higher education network in Latin America with the planned sale of universities in Brazil, and also is exiting the U.S. market with a sale of Walden University.

a man wearing glasses and a suit and tie: Baltimore, MD-11/14/17 - Eilif Serck-Hanssen is president and CEO of Laureate Education Inc.

© Amy Davis / Baltimore Sun/The Baltimore Sun/TNS
Baltimore, MD-11/14/17 – Eilif Serck-Hanssen is president and CEO of Laureate Education Inc.

The international higher education company said Sunday it has agreed to sell its Brazilian operations to Ser Educacional S.A., a Brazil-based network of educational institutions, in a deal valued at $724 million at the current exchange rate and share value.


Load Error

In addition, the company announced Friday it plans to sell Walden University, an online college considered a pioneer in distance learning that offers doctoral, master’s, bachelor’s and graduate certificate programs. Laureate plans to sell Walden, its only U.S. business, to Adtalem Global Education Inc. for $1.5 billion in cash.

It also announced the completion Friday of a sale of its Chilean institutions.

Laureate, which started with one university in 1999 hoping to expand educational access in underserved parts of the globe, said in January it would evaluate each of its businesses for a possible sale, spin off or combination with another business. At that point, it was exploring the sale of its Peru, Mexico and Australia/New Zealand businesses.

Since then it has agreed to divest operations in Australia and New Zealand, as well as the U.S., Chile and Brazil. The recent announcements leave Laureate operating seven institutions in Honduras, Mexico and Peru, one in Malaysia and an online university in the U.K.

The decision to sell in each case was based on commercial, geopolitical, regulatory and market factors, said Eilif Serck-Hanssen, Laureate’s president and CEO, in an announcement.

In January, Serck-Hanssen had said Laureate was acting “from a position of strength, having improved our operations company-wide through significant cost and efficiency initiatives. At the same time, we believe that the public market undervalues our portfolio of assets compared to the values that could be realized for those assets in the private market or through other transactions.”

He indicated the company would continue seeking alternatives for its remaining businesses.

The company is selling the 11 higher education institutions it runs in Brazil, which together enroll more than 267,000 students in technical, undergraduate and postgraduate programs.

“We are incredibly proud of our Brazilian institutions and their enduring impact on the lives of their students,” Serck-Hanssen said in the announcement. “They demonstrate the best of Laureate’s commitment to deliver quality at scale.”

The Brazil deal, slated to close toward the end of next year, includes the assumption of indebtedness, net of cash, which was $124.9 million as of June 30. Laureate will receive cash and shares of Ser Educacional and will become owner of about 44% of Ser Educaional shares. The Brazilian company will seek to list American depositary shares on a U.S. securities exchange.

a group of people in front of a building: Laureate Education's offices in Harbor East.

© Algerina Perna / Baltimore Sun/The Baltimore Sun/TNS
Laureate Education’s offices in Harbor East.

The sale is subject to certain closing conditions, such as regulatory approval and completion of its depositary shares listing. The sales agreement includes a 30-day “go shop” period in which Laureate may solicit, encourage and enter into negotiations that may yield alternative acquisitions proposals. Ser Educacional has a right to match a superior proposal and to receive a fee if Laureate terminates the agreement to accept another bid.

Laureate said Friday it completed the sale of its operations in Chile, where it had operated for two decades. That deal included a transfer of control of its not-for-profit institutions to Fundación Educación y Cultura, a Chilean nonprofit, and the sale of its for-profit operations.

The Baltimore firm sold Instituto Profesional AIEP in Chile to Universidad Andrés Bello in a deal valued at $214.6 million. It sold other Chilean assets, such as Instituto Profesional Escuela Moderna de Música to Fundación Educación y Cultura for $3.6 million.

Serck-Hanssen said in Friday’s announcement of the closing in Chile that it is “the right time for Laureate to pass the torch to a dedicated in-country organization highly attuned to local constituencies and the changing regulatory landscape.”

Shares of Laureate’s stock, which have risen in recent days, were trading down 43 cents Tuesday at $12.71 each.


©2020 The Baltimore Sun

Visit The Baltimore Sun at www.baltimoresun.com

Distributed by Tribune Content Agency, LLC.

Continue Reading

Source Article