Investing in Proprietary Education

An analysis of the business and financial benefits of acquisitions or mergers in the for-profit proprietary education industry

The for-profit proprietary education industry is offering students a chance to study through the internet , in the buildings close to home and many other methods . The advantage they have over regular colleges is that they have shorter courses . The courses offered are usually based on demand and they are run in a very methodical and systematic approach that saves money and time . The difference in approach stems from the fact that the proprietary schools [banner_entry_middle]

are profit oriented and so they use technology to save money , they choose not to offer curricular activities and other deviations like clubs etc . its strict and simple studies and that ‘s all that matters

From a merger and acquisition perspective , the industry is growing and there are a couple of very big companies . The top 2 companies owned by the Apollo Group – `University of Phoenix ‘ have a market value of 25 Billion . That is a lot of money considering many public colleges don ‘t have that kind of funding available to them . Below is a list of the listed companies in the US

Stock value of publicly traded postsecondary education companies

Company Stock Value

The Apollo Group Online 9 ,819 ,960 ,000

The Apollo Group (University of Phoenix and Western International U 13 ,976 ,028 ,000

Career Education Corporation (American Intercontinental , Briarcliff California School

Of Culinary Arts , International Academy of Design and Technology Whitman-CTU , Sanford Brown and UDS 3 ,136 ,616 ,800

Concorde Career Colleges 82 ,730 ,000

Corinthian (Rhodes , Florida Metropolitan , Wyotech , Bryman , and CDI 1 ,023 ,645 ,150

DeVry (Keller School of Management 1 ,364 ,421 ,400

Education Management System (The Art Institutes , Argosy Education Group American Education Centers 2 ,066 ,038 ,400

EVCI Career Colleges , Inc 93 ,030 ,000

ITT Technical Institute 1 ,501 ,440 ,000

Laureate Education Inc (Formerly Sylvan Education Systems (Canter Walden , Wall Street , International Universities 1 ,479 ,708 ,000

Strayer Education Inc 1 ,480 ,000 ,000

Universal Technical Institute (UTI 730 ,628 ,700

Washington Post (Kaplan , Concord 6 ,841 ,118 ,000 The proprietary education business is not directly dependant on grants – although their students are . This leaves them free to run their business the way they of course there are regulatory bodies that monitor them as education providers

With so much of money within the players it is imperative that at some point of time they are going to merge and the big companies will acquire smaller companies . However , the purpose of mergers or acquisitions in this industry is not directly justified . The customers (students ) are not permanent and they leave after 2 years (depending on the course

The technology they use cannot justify a merger as technology of one company cannot be much ahead of others to justify acquisitions . The only reason for acquisition can be the content that companies have in their database , the courses that are already available to another company which will help in… [banner_entry_footer]