NEW YORK — July 8, 2020 — Berkery Noyes, an independent mid-market investment bank, today released its half year 2020 mergers and acquisitions trend report for the Education Industry.
The report analyzes M&A activity during the first half of 2020 and compares it with the four previous six-month periods from 2018 to 2019. This market includes information and technology companies servicing the Education Industry, including the Childcare Services, K-12, Post-Secondary, and Corporate and Professional Training segments.
Total transaction volume declined 13 percent on a half year basis. In terms of acquirer type, strategic volume increased six percent, from 156 to 166 deals. This was the highest level of strategic volume during the past 30 months. Meanwhile, private equity volume fell 50 percent, from 82 to 41deals.
Aggregate transaction value rose 19 percent, from $7.57 billion to $9.01 billion. The median revenue multiple dropped from 2.8x to 2.2x, which was in line with the industry’s median over the past two and a half years.
The segment with the largest rise in volume was Professional Training Services with a 36 percent gain. This marked the sector’s peak volume level during the last 30 months. In addition, Professional Training Technology volume experienced a slight uptick, which was the segment’s fourth consecutive quarterly rise. High profile acquirers in the combined Professional Training segments year-to-date included Moody’s acquisition of RBA International, a provider of online retail bank training and certification; and Morningstar’s acquisition of Sustainalytics, an environmental, social, and governance (ESG) ratings and research company.
Deal volume in the K-12 Media and Tech segment declined 34 percent, from 47 to 31 deals. Notable acquirers in the segment year-to-date included Chegg’s acquisition of Mathway, an automated tutor that helps students understand and solve their math problems, for $96 million; and ACT’s acquisition of ScootPad, an adaptive learning platform.
As for other select markets covered in the report, Higher Ed-Media and Tech volume decreased 29 percent during the half year period, from 35 to 25 acquisitions. The Higher-Ed Institutions segment saw a 22 percent decline, from 32 to 25 deals, while volume in the K-12 Institutions segment decreased 40 percent, from 15 to 9 transactions.
A copy of the EDUCATION INDUSTRY M&A REPORT FOR HALF YEAR 2020 is available at the Berkery Noyes website.