Career Education sells European business for more than total market cap
Oct 24 (Reuters) - Career Education Corp said it will sell its European education business to private equity firm Apax Partners for about $305 million, sending its shares up more than 50 percent in extended trading on Thursday.
The sale - valued at more than Career Education's market capitalization - includes its entire international schools business, comprising the Paris-based INSEEC Group and the International University of Monaco.
The for-profit education provider will receive about $276.5 million when the deal is closed, taking into account various adjustments, the company said.
"Redeploying capital from Europe to the United States is the right move for Career Education. It will help us best serve the vast majority of our students, who are U.S.-based," Chief Executive Scott Steffey said in a statement.
The transaction is expected to close before the end of the year, the company said.
The company agreed in August to pay $10.25 million to settle a New York state probe into accusations that it had inflated job placement rates to attract students.
Careeer Education announced in November that it would shut 23 campuses due to losses and falling enrollments. The company said at the time that it had 90 campuses.
Morgan Stanley & Co LLC acted as Career Education`s exclusive financial adviser for the deal.
The company's shares were trading at $5.75 at 04.37 p.m. ET, after closing at $3.80 on the Nasdaq. At $3.80, the company had a market value of about $255 million.
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