2019-10-09 Berkery Noyes Releases Education Industry M&A Report For Third Quarter 2019

NEW YORK — October 9, 2019 — Berkery Noyes, an independent mid-market investment bank, today released its third quarter 2019 mergers and acquisitions trend report for the Education Industry.

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

Aggregate transaction volume year-to-date improved four percent compared to the corresponding timeframe in 2018. Total deal value declined 33 percent during this timeframe, from $9.6 billion to $6.5 billion. In terms of valuations, the median revenue multiple increased from 2.0x to 3.2x.

Regarding the combined Professional Training Technology and Services segments, volume increased 13 percent year-to-date over the first three quarters of 2018. The combined Professional Training Technology and Services segments accounted for slightly more than one-third of aggregate volume during the past three months.

Notable Professional Training related deals in third quarter 2019 included Leeds Equity Partners’ acquisition of VitalSmarts, a provider of communication, execution and leadership development training; and Korn Ferry’s acquisition of three companies in the leadership development area: Miller Heiman Group, AchieveForum, and Strategy Execution.

M&A activity in the K-12 Media and Tech segment decreased 11 percent year-to-date over the first three quarters of 2018. Notable deals in the third quarter included Frontline Education’s announced acquisition of Perennial EdTech, a group of education software companies that seek to improve K-12 school administration software ecosystems; Apax Digital’s announced acquisition of MetaMetrics, an education technology organization that offers the only scientifically valid, universal scales for measuring reading and listening as well as math; and Noodle’s acquisition of Clark, a business software solution for tutors.

As for other select markets, transaction activity in the Higher-Ed Media and Tech segment increased 22 percent year-to-date over the first three quarters of 2018. Notable segment transactions in third quarter 2019 included John Wiley & Sons’ announced acquisition of Zyante, a provider of computer science and STEM education courseware, for $56 million; and Elsevier’s announced acquisition of Parity Computing, which employs artificial intelligence to transform raw STM content for publishers and researchers.

Deal flow in the Childcare Services segment remained constant year-to-date over the first three quarters of 2018. Notable Childcare Services transactions in third quarter 2019 included Busy Bees Childcare’s acquisitions of Educational Playcare, an early childhood education and care provider; and Doremi, an early childhood education and care provider known for its bilingual services.

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