2020-01-10 Berkery Noyes Releases Education Industry M&A Report For Full Year 2019

NEW YORK — January 10, 2020 — Berkery Noyes, an independent mid-market investment bank, today released its full year 2019 mergers and acquisitions trend report for the Education Industry. 

The report analyzes M&A activity in the sector during 2019 and compares it with data covering 2017 and 2018. This market includes information and technology companies servicing the Education Industry, including the Childcare Services, K-12, Post-Secondary, and Corporate & Professional Training segments.

Transaction volume increased nine percent on a year-to-year basis. Total value in 2019 declined 21 percent, from $15.64 billion to $12.30 billion. In terms of valuations, the median revenue multiple rose from 1.8x to 2.6x.

As for specific markets, volume in the Higher-Ed Institutions segment gained 46 percent, making it the sector with the largest yearly rise. M&A activity in the Higher-Ed Media and Tech segment improved 15 percent.

The K-12 Media and Tech segment saw volume remain constant over the past year. Notable segment deals in 2019 included Nexus Capital Management’s acquisition of Pearson’s US K-12 Courseware Business for $250 million; and i3 Verticals’ acquisition of Pace Payment Systems, which offers payment processing products and services for K-12 school systems, for $52 million.

K-12 Media and Tech was tied with Professional Training Services as the industry’s most active market segment in 2019. Upon examination of the Professional Training market, Services transactions underwent a four percent uptick in volume whereas the number of Technology deals increased 21 percent.

Notable transactions in the combined Professional Training Technology and Services segments over the past year included Wendel Group’s acquisition of Crisis Prevention Institute, which provides behavior management and crisis prevention training programs, for $910 million; and 2U’s acquisition of Trilogy Education Services, a workforce accelerator that offers skills-based training programs in high-demand tech fields at universities and companies, for $750 million.

Meanwhile, Leeds Equity Partners was an active acquirer in the Professional Training Services segment during 2019 with four transactions (either directly or through an affiliated business):

• Kaplan Altior, which delivers classroom-based, online and in-house skills training and assessments to its clients and delegates in the legal and professional services sectors;
• VitalSmarts, a communication and leadership development training business;
• The Center for Legal Studies, which offers online programs and training courses for paralegals and other legal support professionals; and
• Watermark Learning, a business analysis and project management training company.

A copy of the EDUCATION INDUSTRY M&A REPORT FOR FULL YEAR 2019 is available at the Berkery Noyes website.