Exclusive: Blackstone in advanced talks to buy Ascend Learning - sources

(Reuters) - Private equity firm Blackstone Group LP BX.N is in advanced talks to acquire Ascend Learning LLC, a privately held U.S. maker of educational software, for more than $2 billion, including debt, according to people familiar with the matter.

FILE PHOTO - The ticker and trading information for Blackstone Group is displayed at the post where it is traded on the floor of the New York Stock Exchange (NYSE) April 4, 2016. REUTERS/Brendan McDermid/File Photo

The deal would underscore the appetite of buyout firms for companies in the educational software sector, at a time when corporate America and schools are using more digital tools to enhance learning and reduce some of their operational costs.

Blackstone has prevailed in an auction for Ascend Learning, and is now negotiating terms with its majority owner, private equity firm Providence Equity Partners LLC, the sources said on Thursday.

A deal could be announced as early as this month, the sources added, cautioning that it was still possible that negotiations would end without a deal.

The sources asked not to be identified because the negotiations are confidential. Blackstone and Providence Equity declined to comment. Ascend Learning did not respond to a request for comment.

The transaction would be the latest private equity deal in the educational software sector. In 2015, private equity firms TPG Capital LP and Leonard Green & Partners LP acquired Ellucian Company LP, a U.S. provider of software to universities and colleges, for $3.5 billion, including debt.

Based in Burlington, Massachusetts, Ascend Learning offers software programs for testing and certifications in various industries, from nursing to sports medicine. The majority of its revenue comes from the healthcare and public safety sectors.

Ascend was formed in 2010 by Providence Equity after it combined companies it had previously acquired, including nursing school testing company Assessment Technology Institute LLC.

Providence Equity also owns Blackboard Inc, a U.S. software company that provides learning tools for high school and university classrooms.

It explored a sale of the company in 2015, but then ultimately decided to put it on hold. The private equity firm also has previously invested in education companies ITT Educational Services Inc ESI.N, Archipelago Learning and Education Management Corp.

Based in New York, Blackstone is the world’s largest alternative asset manager, with more than $360 billion in assets under management.

Reporting by Liana B. Baker and Greg Roumeliotis in New York; Editing by Andrew Hay