お知らせ • Aug 14
Adtalem Global Education Inc. (NYSE:ATGE) completed the acquisition of Walden e-Learning, Inc. from Laureate Education, Inc. (NasdaqGS:LAUR).
Adtalem Global Education Inc. (NYSE:ATGE) entered into a membership interest purchase agreement to acquire Walden e-Learning, Inc. from Laureate Education, Inc. (NasdaqGS:LAUR) for $1.5 billion on September 11, 2020. The consideration will be paid in cash and is subject to certain adjustments set forth in the purchase agreement. The Consideration will be adjusted upward by, among other things: the amount, if any, by which the working capital of the Walden Group at closing exceeds a target amount of negative $57,728,896 and closing cash of the Walden Group. The Consideration will be adjusted downward by, among other things: the amount, if any, by which the Target Working Capital exceeds the working capital of the Walden Group at closing; Laureate transaction expenses, which includes any out-of-pocket fees, costs and expenses incurred by the Walden Group to any third party or to Laureate, certain transaction bonuses and half of all filing fees under the HSR Act; the indebtedness of the Walden Group immediately prior to closing; and the Closing Tax Amount, which includes the liability for certain taxes of the Walden Group that are accrued but unpaid as of the closing with respect to any pre-closing tax period. The transaction also includes the acquisition of Walden University, LLC, subsidiary of Walden e-Learning, Inc. Adtalem expects to fund the cash consideration through a combination of cash from its balance sheet and committed debt financing. In connection with its entry into the Purchase Agreement, Adtalem entered into a commitment letter, dated September 11, 2020 with Morgan Stanley Senior Funding, Inc., Barclays Bank PLC, Credit Suisse AG, Cayman Islands Branch and Credit Suisse Loan Funding LLC and MUFG Bank, Ltd., pursuant to which and subject to the terms and conditions set forth therein, the Parties have agreed to provide (i)(A) a senior secured term loan facility in an aggregate principal amount of $1 billion, (B) a senior secured revolving loan facility in an aggregate commitment amount of $400 million and (ii) a senior secured bridge term loan credit facility in an aggregate principal amount of up to $650 million. The proceeds from the Facilities will be used, among other things, to finance the Contemplated Transaction, refinance Adtalem’s existing credit agreement, pay fees and expenses related to the Contemplated Transaction and, in the case of the Revolving Facility, to finance ongoing working capital and general corporate purposes. On February 12, 2021, Adtalem Global Education Inc. announced that its wholly-owned subsidiary, Adtalem Escrow Corporation priced its previously announced offering of $800 million aggregate principal amount of 5.50% Senior Secured Notes due 2028. the net proceeds from the offering, along with other financing sources, to finance the purchase price payable in connection with the Company’s previously announced acquisition of Walden e-Learning, LLC and Walden University, LLC and to pay related fees and expense. As of June 23, 2021 to Walden University meets the definition of a DOE Preacquisition Response and (ii) to waive any right to terminate the Agreement (ii) thereof in respect of the DOE Notification. Laureate Education, Inc. also agreed to provide additional indemnification to Adtalem from and after the closing of the transactions contemplated by the Agreement.Adtalem Global Education may be required to pay a termination fee of $88 million in case of termination of transaction. Walden University will remain part of the Laureate International Universities network until the closing of the transaction.
The purchase price represents a pre-synergy adjusted EBITDA multiple of 8.4x. The transaction is subject to customary closing conditions, including regulatory approval by the U.S. Department of Education and the Higher Learning Commission and required antitrust approvals. The Boards of Laureate, Adtalem Global Education and Walden University have unanimously approved this transaction. As of September 7, 2020, Special Transaction Committee recommends that the Board approve the execution of a definitive agreement. Engine Capital And Hawk Ridge Urged the Board Not To Close the Walden Acquisition Prior to the Resolution of the Department of Justice Investigation. The closing of the transaction is expected to occur toward the end of fiscal 2021. As of February 2, 2021, transaction is expected to close in mid calendar year 2021. As of April 29, 2021, the transaction is expected to close in the first quarter of fiscal year 2022. Laureate intends to use substantially all of the after-tax proceeds for general corporate purposes, which may include repayment of certain indebtedness and return of capital to stockholders. The transaction is expected to contribute significantly to Adtalem’s free cash flow and earnings per share, generating $60 million in incremental free cash flow excluding special items in year one and adding $0.75 in earnings per share from continuing operations excluding special items in year two as synergies begin to offset the dilutive effect of purchase price accounting. Adtalem expects to generate annual cost savings of approximately $60 million driven by increased efficiencies in marketing spend and back office operations. Approximately $30 million of these cost savings are anticipated within 12 months of closing and the remainder within 24 months of closing. Additionally, Adtalem expects that this acquisition will generate between 10% and 12% ROIC beginning in year one, significantly exceeding the company’s current WACC of approximately 8%.
Goldman Sachs & Co. LLC is acting as the exclusive financial advisor to Laureate, and Jakob Rendtorff, Gary Horowitz, Sebastian Tiller, Andrew Blau, Lori Lesser, David Azarkh, James Cross, Sara Razi, Kelly Karapetyan, Jonathan Porter, Karen Hsu Kelley and Shari Ness of Simpson Thacher & Bartlett LLP, Faegre Drinker Biddle & Reath LLP and Scott Levine of Jones Day are acting as legal advisors to Laureate Education, Inc. Morgan Stanley & Co. LLC is acting as Adtalem’s financial advisor and committed financing is being led by Morgan Stanley Senior Funding Inc. Catherine J. Dargan, Allison Schiffman and Amy F. Wollensack of Covington & Burling LLP is providing legal counsel to Adtalem. Goldman Sachs & Co. LLC will receive a fee of $10.36 million for its services.
Adtalem Global Education Inc. (NYSE:ATGE) completed the acquisition of Walden e-Learning, Inc. from Laureate Education, Inc. (NasdaqGS:LAUR) on August 12, 2021. Adtalem funded the purchase price through a new credit agreement entered into on August 12, 2021, with a combination of loans under the Term Facility consisting of $850.0 million in aggregate principal amount of term loans, the proceeds from the sale of $800.0 million of 5.50% Senior Secured Notes due 2028 issued by a subsidiary of Adtalem and cash on hand. Paula Singer will continue to serve as Walden’s president, managing strategy and operations for the university. The transaction is expected to generate significant long-term value for shareholders by being accretive to Adtalem’s pro forma margin profile and driving top-line growth through renewed organic investment in Walden. Having closed as anticipated in the fiscal first quarter, the combined company is expected to generate more than $4.00 of diluted earnings per share from continuing operations, excluding special items and expected impact of purchase accounting, for fiscal year 2022 (non-GAAP).