Another Bailout by a For-Profit
A struggling private college in West Virginia announced Friday that it had received permission from state officials to transform itself into a for-profit institution by selling itself to three for-profit entities.
Salem International University, with about 400 students on its campus and a similar number taking online courses, has had financial difficulties for years. Salem International, founded in 1888, was a small liberal arts and teacher preparation college for most of its history. In the last decade, it has sought to improve its finances through relationships with a Japanese university (Salem International was briefly known as Salem-Teikyo University) and a private education company in Singapore.
Richard W. Ferrin, president of the university, said in an e-mail message Saturday that he could not comment on the negotiations for Salem to become a for-profit institution because of confidentiality requirements. But documents Salem has filed suggest that the college faces serious financial difficulties.
Salem's last informational tax form available through the Guidestar database shows the university with nearly $11 million in annual expenses and just over $6 million in annual revenues.
The Associated Press reported that the deal in the works would involve three investment groups paying a total of $1 million for Salem. For the deal to become final, additional negotiations remain between the college and the investors, and accreditors must sign off as well.
Dennis Wainstock, an associate professor of history, said in an interview Saturday that he and other faculty members were extremely encouraged by the discussions going on to sell the university. He said that faculty members have met with the investors and believe that the new ownership will allow for money to hire more faculty members, especially in business and the sciences. He also said that he expected distance education programs to be expanded.
"These people seem to really care about education," he said. "They are not just in it for the money."
If the deal goes through, it will be the second transition this year of a nonprofit college into a for-profit institution. In March, Bridgepoint Education, a for-profit institution in California, purchased the Franciscan University of the Prairies, a Roman Catholic college in Clinton, Iowa. Franciscan, founded in 1918, was known for most of its history at Mount St. Clare College. Bridgepoint changed the name of the college to Ashford University.