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US: Education M&A volume up 26% in 2015

Mergers and acquisitions in the US education market increased by 26% in 2015, a report by investment bank Berkery Noyes has claimed. 

Between 2014 and 2015, it said, the total number of deals rose from 329 to 415. 

Total transaction value also rose, from $11.7 billion (£8.2 billion) to $17.7 billion, although company valuations decreased slightly, with median ebitda multiples falling from 11.5x to 9.6x.

Berkery Noyes said “significant participation" from strategic acquirers in the market had pushed up total transaction value. Managing director Peter Yoon said private equity firms were also increasingly interest in the sector.

"They are attracted by the sheer scale of the market, the favourable lending environment, and the increasing number of companies that are growing with subscription-based revenue models," he said.

The area of most activity in 2015 was the corporate and professional education space, accounting for nearly a third of deals.

It was closely followed by the K-12 media and tech space where there were nearly 80 transactions.
 
The area with most growth was higher education media and tech, where transactions climbed from 47 last year to 79. 

German publishing company Bertelsmann was the most active buyer overall, snapping up ed tech firms RediLearning, Academy Medical, YoBoHo and professional school chain Alliant International University. 

And the biggest deal was TPG Capital and Leonard Green Capital Partners’ acquisition of higher education software provider Ellucian for $3.5 billion (£2.5 billion) in August. 


Posted on: 26/01/2016




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