State University System Considering the Acquisition of a For-Profit College

[apl68]

The University of Arkansas is considering the acquisition of for-profit Grantham University:

A proposed deal for the University of Arkansas System to acquire a for-profit online college will be considered Wednesday by the system's trustees board.

A deal for Grantham University would potentially jump start efforts that have stalled for the UA System's eVersity, an online-only venture created with board approval in 2014 to recruit working adults and enroll them in programs to finish their degrees.

The board will consider a resolution for University of Arkansas System President Donald Bobbitt "to take such additional steps as are necessary to establish University of Arkansas — Grantham as a campus of the University of Arkansas System."

An acquisition proposal states that "the new campus will eventually integrate with eVersity, resulting in a single online university."

"This potential acquisition represents a game-changer for our efforts to reach those adults who are underserved by public higher education because of their need to attend fully-online, flexible institutions," Bobbitt said in a statement.

The proposed deal calls for the UA System's board to take on "certain discrete liabilities" while acquiring — for $1 — "substantially all the assets" of a school that, according to federal data, enrolls about 5,600 students and has one out of every four go on to graduate within eight years.

Financial details about the liabilities the UA System would take on were not disclosed in agenda documents made public ahead of Wednesday's meeting, despite a 44-page proposed asset purchase agreement referencing an "Exhibit D" listing assets and liabilities that would transfer as part of the deal.

The UA System declined to provide the "Exhibit D" document after reviewing a request for public records submitted by the Democrat-Gazette. The "Exhibit D" documents were exempt from public disclosure Monday "because they involve proprietary data of a private, for-profit entity and doing so would provide a competitive advantage," UA System spokesman Nate Hinkel said in an email, citing Ark. Code Ann. § 25-19-105(b)(9)(A).

An acquisition proposal states, however, that "there would be no long-term service agreement, revenue sharing, or ongoing relationship with the current owners of the university after the transaction is complete." As part of the deal, the UA System would "initially" employ about 240 faculty members and pay for the services of about 170 Grantham University staff employees.

Grantham University, based in Lenexa, Kan., offers associate, bachelor's and master's degrees, as well as undergraduate and graduate certificates, in more than 60 academic programs, according to the proposal. A deal also would require approval from the Grantham University's board. The university's owner, The Level Playing Field Corp., also has a board that would have to approve the transaction.

More at

https://www.arkansasonline.com/news/2021/aug/10/ua-board-consider-acquiring-profit-online-college/

[mamselle]

I'd wonder if the for-profit would suddenly revive itself and take over its meant-to-be savior college--a bit like the eggs in "Aliens" take over the bodies of their hosts and eat them out for nourishment...

But I'm cynical that way...

M.

[clean]

I dont know if this changes the discussion, but the 'eggs' in Aliens dont eat the host, they Burst From the host's Chest!

https://tenor.com/view/chestbuster-aliens-chest-buster-gif-15100290

(enjoy)
Return to regular programming...

I suspect that Grantham is on its deathbed.  The price of $1 and taking over of the liabilities indicates that it is essentially bankrupt.  The assets, however, being already in place, may be cheaper to acquire in this manner than to try to replicate the same infrastructure from scratch.  Not to mention that they work NOW, and there is no delay while another plan is designed and implemented.  In that way, it may well be a bargain.  IF the liabilities are all debt, and not contingent, like being subject to a claw back of Federal Financial Aid money, ... as long as the values of the debt are known with certainty, then debtholders may well be in a much better situation with the liabilities being owed by a state rather than a for profit educational firm. 

anyway, depending on the actual Exhibit D price, it may be worth while to consider.   Good for them! A potential Win all around (except for the Student Loan people IF the state is not liable for any past problems with Grantham (if any).

[rth253]

Didn't this already happen with Purdue University acquiring Kaplan and re-naming it "Purdue University—Global"?