Washington DC (USA), July 2011 - Providence Equity Partners Inc., an owner of SunGard and provider of administrative systems for higher education has agreed to buy Blackboard Inc., the learning management system industry giant for $1.64 billion. Providence is a private equity firm focused on media, communications, information services, and education investments.
The transaction is subject to approval of a majority of the outstanding shares of Blackboard common stock and other customary closing conditions and regulatory approvals. The transaction is anticipated to close during the fourth quarter of 2011. Upon closing, Blackboard will become a privately-held company, remain headquartered in Washington DC, and continue to be led by its existing senior management team.
The deal will be financed through a combination of equity and debt. Bank of America Merrill Lynch, Deutsche Bank, and Morgan Stanley have provided debt-financing commitments.
In regard to the takeover, at least one crystal-ball gazer appears to have had its gaze in the right direction. Every year the Gilfus Education Group, an independent education consulting firm, releases predictions about the education market. In October of 2009, the Group predicted the "combination of academic and administrative functionality into a more cohesive experience". At the same time Gilfus released a strategic white paper proposing "The Enterprise Education Platform", which outlined many of the benefits and opportunities of such a convergence.
The acquisition could result in a single provider of academic and administrative systems for the higher education market and has the potential to bring to life concepts presented in the strategic whitepaper entitled "Intelligence Emerges from an Enterprise Education Platform". Specifically, the work foresees a linkage of this type engendering a possible reduction of the "costs of fragmentation" higher education institutions encounter due to a lack of optimization of processes involving academic technology.
