Graduate Students

In Latest Deal for Online College, Private-Equity Group Buys Northcentral U.

January 07, 2009

Another week, another transaction involving a for-profit online college.

The latest: A private-equity group announced today that it was buying Northcentral University, an all-online institution founded in 1996 and now enrolling about 7,500 students, mostly in graduate-level degree programs.

The buyer is Rockbridge Growth Equity, of Detroit. Terms of the sale were not disclosed.

The sale of Northcentral, based in Prescott, Ariz., comes just days after another company that operates institutions with a major distance-education focus, Bridgepoint Education, filed notice with the Securities and Exchange Commission that it would seek to go public.

And it comes just two months after Grand Canyon University completed its initial public offering. Although the Grand Canyon IPO did not fetch as high a price as company executives had hoped, the stock has since risen in value, which is fueling investor interest in the for-profit higher-education sector.

While many traditional colleges are feeling the pain of the recession, some conditions of the economy are actually positive for the for-profit colleges. —Goldie Blumenstyk