More For-Profits Considering Flip to Nonprofit

Discussion in 'Accreditation Discussions (RA, DETC, state approva' started by Jonathan Whatley, Jul 17, 2014.

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  1. Jonathan Whatley

    Jonathan Whatley Well-Known Member

    Sources tell Inside Higher Ed that four for-profit U.S. colleges – not identified – are currently looking at converting to non-profit.

    Dropping Profit: Few for-profits have become nonprofits, despite regulatory environment (Paul Fain, Inside Higher Ed, July 17, 2014)
     
  2. Tim D

    Tim D Member

    I would be interested to know what for-profits were looking at the possible flip(though Grand Canyon comes to mind ). Some of the large one's I think would be quite impossible to flip(like UoP). I even think APUS would struggle with such a transition considering it's publically traded. Though with the student loan crisis and the bad press it's not surprising that some institutions may opt to go this route just to survive. As I know I have read multiple harsh articles written about for-profit higher ed.
     
  3. Jonathan Whatley

    Jonathan Whatley Well-Known Member

    Grand Canyon University is also publicly-traded through Grand Canyon Education, Inc. (NASD: LOPE), with a market capitalization of about $2.08 billion. A flip to nonprofit requires all the shares of the for-profit being given or sold to a nonprofit. This is much more likely for a closely-held private company. Perhaps it could happen to a publicly-traded company that was severely distressed, close to bankruptcy. Perhaps it could happen to non-distressed publicly-traded company if most of the shares were closely held and that ownership group bought up the rat of the shares outstanding and took it private in the process.
     

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