ECMC Group announced Thursday that it has entered into an agreement to acquire 56 Everest and WyoTech campuses from Corinthian Colleges Inc. and transition them from for-profit to nonprofit status. The total purchase price is $24 million.
Corinthian is the embattled former operator of more than 100 for-profit college campuses in the U.S. and Canada. Federal and state regulators and investigators have launched numerous actions against the company over its lending, funding, and debt collection practices. In July, the company and the Department of Education (ED) agreed on a plan that would shutter a dozen Corinthian campuses and sell the remainder to third parties.
ECMC is the first announced buyer of former Corinthian campuses. The company is purchasing nearly all of the Everest and WyoTech-branded campuses that are not located in California. The full list is available here.
ECMC Group is forming a non-profit subsidiary, Zenith Education Group, to facilitate the sale and run the campuses post-transaction. ECMC is the parent company of Educational Credit Management Corporation, one of the largest student loan guaranty agencies in the U.S. and an ED partner, as well as Premiere Credit of North America, a debt collection agency that collects student loans on an ED contract.
ECMC said that the transition from for-profit to non-profit status would involve transforming “the culture and education model at the acquired schools, including lowering tuition and introducing strict accountability standards for program completion and job placement rates.”
“This is an extraordinary opportunity for us to make a difference in career education by offering students a new path for gaining the in-demand skills and training that employers are seeking,” said David Hawn, president and CEO of ECMC Group. “We are bringing our resources to bear to transform Everest and WyoTech into schools that are synonymous with student success – measured by strong program completion and job placement rates.”
The transaction is subject to federal and state regulatory approval, most notably from ED. But the Education Department has already signaled its support in an official press statement released in conjunction with the acquisition announcement.
“The U.S. Department of Education announced its support today of an agreement between ECMC Group and Corinthian Colleges Inc. for ECMC Group’s newly formed nonprofit education entity, Zenith Education Group, to acquire 56 Everest and WyoTech campuses for transition to nonprofit status,” the statement rather directly read.
ED also noted that the transaction would directly impact nearly 40,000 students whose campuses would have closed if a deal did not happen soon. ED has launched a microsite to help students and former students that went through Corinthian.