August 11, 2022

DealBook: Providence to Buy Blackboard for $1.64 Billion

Michael Chasen, chief executive of Blackboard.BlackboardMichael Chasen, chief executive of Blackboard.

Providence Equity Partners agreed on Friday to buy Blackboard Inc., a maker of college coursework software, for $1.64 billion in cash, in the private equity firm’s latest foray into the education market.

Under the terms of the deal, Providence will pay $45 a share, a 3.7 percent premium to Blackboard’s closing price on Thursday. It is 21 percent higher than Blackboard’s stock price on April 18, the day before the company announced it was considering a sale.

Providence will also assume $130 million of Blackboard’s net debt.

“In Providence, we will have a partner who brings a deep understanding of the international education marketplace and shares our vision of providing educators with exceptional technology solutions and services to meet their evolving needs over the long-term,” Michael Chasen, Blackboard’s chief executive, said in a statement.

Founded in 1997, Blackboard is among the most popular makers of course management software for universities. Its products allow students to find their coursework online and submit their assignments electronically, as well as providing analytics and other services.

Providence already has a sizable presence in the education market, with investments in companies like two for-profit college operators, Education Management Corporation and Study Group, and another education software maker, Archipelago Learning.

The deal is expected to close in the fourth quarter, pending approval from Blackboard’s shareholders. The company will remain based in Washington and will keep Mr. Chasen and its existing management.

Providence has secured debt financing from Bank of America Merrill Lynch, Deutsche Bank and Morgan Stanley.

Blackboard was advised by Barclays Capital and the law firm Dewey LeBoeuf. Providence received legal counsel from Weil, Gotshal Manges.

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