The Education Investor: Second Quarter 2002

Authors: Outsell Client Services, Client Services; Eduventures, Inc.

Although the dearth of investment activity in the first quarter cast a gloomy pall over the prospects for education businesses accessing private capital, private investment in education rebounded significantly in the second quarter of 2002. However, at the year's midpoint, private investment in education businesses remains significantly off from that in previous years. At the current rate, this year, private investment will reach lows not seen since 1995, when $333 million in private investment flowed into the education industry.

But while 1995 saw just a handful of mergers and acquisitions, M&A activity in 2002 has been comparatively far greater. Established firms are taking advantage of their position of strength in seeking to expand their businesses, and the majority of private investment and M&A activity during the second quarter of 2002 involved "brick-and-mortar" businesses.

This edition of The Education Investor offers a snapshot of second quarter private investment and M&A transactions.