* Purchase price about $7 million - CFO
* Welch also participating in the deal
* Strayer shares jump 7 pct
By Megha Mandavia and A. Ananthalakshmi
Nov 11 Strayer University is buying the
business management college founded by the legendary former
chief executive of General Electric, Jack Welch, to
expand its bouquet of MBA programs.
Strayer Education Inc, parent company of the
university, would buy the Jack Welch Management Institute (JWMI)
from its current owner, Cleveland-based Chancellor University.
The purchase price is about $7 million, with Welch
contributing about 30 percent of that, Strayer CFO Mark Brown
told Reuters in an interview.
"We had been exploring on our own the opportunity to offer
an executive MBA program when we were contacted by Welch about
potentially acquiring JWMI and offering the MBA program through
that vehicle," Brown said. Strayer already offers a traditional
JWMI's tuition is about $30,060, while Strayer's MBA is
priced at $26,715.
JWMI, founded by Welch in 2009 following his retirement from
GE, offers online executive MBA degrees and certificate programs
for professionals and corporates. It has about 200 students,
Welch, known for transforming GE into the largest U.S.
conglomerate, is a professor at the college and appears in
weekly videos about current business events and involved in the
preparation of the curriculum.
Arlington, Virginia-based Strayer will start offering the
JWMI programs from its winter term, Brown said. The deal is
expected to close by the end of 2011.
Strayer has been struggling with enrollment declines for the
last four quarters after tough new U.S. rules on student debt
forced it to tighten admission standards.
The for-profit college, which offers working adults programs
in accounting, business administration, information technology
and criminal justice, had almost 55,000 students at the end of
"At roughly 0.4 percent of Strayer's enrollment, JWMI is a
relatively small transaction, but a high profile one
nonetheless, and a good complement to Strayer's business focus,"
BMO Capital Markets analyst Jeff Silber wrote in a client note.
Strayer's shares rose 7 percent to $97.26 on Friday on