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Instructure, the publicly traded company behind the popular college learning management system Canvas, is considering a number of strategic options for its business, including a possible sale.
In a statement Thursday, the company said it is weighing whether to go private, be purchased by a strategic partner or continue as a stand-alone public company.
Activist investors Sachem Head, Praesidium Investment Management and Jana Partners have called for Instructure to explore a sale and have reportedly identified multiple potential buyers for the Canvas LMS. Sachem Head is also leading a push for the sale of online program management company 2U.
While Instructure’s higher education business is performing well, its business employee development software Bridge is losing money. Kevin Oram, co-founder and managing partner of Praesidium, told Bloomberg that selling Bridge would unlock the value of Canvas, which he estimated to be worth $2.5 billion.
Phil Hill, a partner at MindWires Consulting and publisher of Phil on Ed Tech, wrote in a blog post that the focus of pressure from investors is to increase support for Canvas, not reduce it. “Instructure management has made it a point to say that they are increasing investment in Canvas, but today’s news puts even more emphasis on that need.”
Hill noted that leading LMS provider Blackboard went through a similar process a few years ago, going private in 2011. Blackboard considered a sale in 2015 but didn’t go through with it. “These processes do not always result in a sale,” said Hill.
“Keep watching -- this should be interesting for the LMS market,” he said.
