Jan 4 ITT Educational Services Inc said it will pay $46 million to Sallie Mae Corp, the largest U.S. student lender, to settle litigation related to a loan agreement between the two.
ITT has risk-sharing and guarantee agreements with some lenders that provide private education loans to its students.
Sallie Mae filed the lawsuit in July 2011 alleging that ITT breached the terms by failing to pay some due amounts under the agreement signed in July 2007. The payment will be made by Jan. 29.
The for-profit education company will record an after-tax charge of $13.2 million, or about 56 cents per share, during the quarter ended December, it said in a filing.
Analysts were expecting ITT to report a fourth-quarter profit of $1.88 per share, according to Thomson Reuters I/B/E/S.
ITT shares rose marginally to $19.39 after the bell on Friday. They had closed at $19.29 on the New York Stock Exchange.