- Category: Economic
- Published Monday, February 8, 2016
- CTV News
NEW YORK -- Apollo Education is being taken private in a $1.1 billion deal by a consortium led by private investment firm The Vistria Group.
Shares jumped more than 24 per cent in trading Monday morning.
The announcement comes about a month after the owner of the University of Phoenix and Western International University among others signalled that it may be looking for a buyer.
Apollo Education has had several lacklustre quarters as enrollments at for-profit schools fell amid increased government scrutiny of the industry.
Shareholders of Apollo Education Group Inc. will receive $9.50 per share, a 37 per cent premium to the Phoenix-based company's $6.95 Friday closing price.
Vistria is joined in the buyout by funds affiliated with Apollo Global Management LLC and Najafi Cos.
Tony Miller, chief operating officer of Vistria and a former deputy secretary of the Department of Education, would be Apollo's chairman.
The acquisition, already approved by Apollo's board, is expected to close by August. It still needs approval from the Department of Education, the Higher Learning Commission and state regulatory and programmatic accreditation bodies. The deal also needs approval from a majority of Apollo Education's Class A and Class B shareholders, voting as separate classes. The Class B shareholders have entered an agreement to vote in favour of the buyout.
Apollo Education shares climbed $1.73, or 24.9 per cent, to $8.68 in midday trading Monday. Its shares are down 66 per cent over the past year.