Perspectives from the field on the Purdue-Kaplan marriage

In the wake of last week's stunning news about Purdue University's planned takeover of Kaplan University, experts assess the deal's impact on the digital learning landscape.

DeVry to Rebrand as Adtalem Global Education

DeVry Education Group is seeking to change its name to Adtalem Global Education Inc., it revealed to shareholders in an SEC filing.

The filing asks shareholders to vote in favor of the name change ahead of a May 22 shareholder meeting at the company's headquarters.

DeVry in recent years has broadened its geographic reach and portfolio of educational offerings. More than half of its 225,000 students are now in Brazil, and nearly a fifth are at health-care institutions. The name Adtalem -- meaning "to empower" in Latin -- reflects those changes, the filing says.

It's been a little more than three years since the company's last name change from DeVry Inc.

Even before the new name change, the company has sought to differentiate itself publicly from the rest of the for-profit sector. It has responded to increased regulatory scrutiny -- and negative headlines -- for the sector by announcing self-imposed reforms such as voluntarily limiting the amount of revenue it takes in from federal aid. However, representatives of other for-profits said DeVry's institutions wouldn't be substantially affected by those self-imposed limits.

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Trump Administration Backs Termination of ACICS

The Trump administration has backed its predecessor's decision to terminate the recognition of the Accrediting Council for Independent Colleges and Schools, a national accreditor that oversees 245 colleges, most of them for-profits.

The Education Department finalized its decision to nix the accreditor shortly before Trump's inauguration, citing concerns about lax oversight of the collapsed Corinthian Colleges, ITT Technical Institute and other colleges. ACICS sued to block the department's move.

Last weekend the department filed a legal brief supporting the Obama administration's move. Among other arguments, the department said ACICS had failed to swiftly and properly adopt sufficient standards. "For example, despite having applied for renewal of recognition in January of 2016, the secretary noted that, as of December 2016, ACICS still lacked a standard with respect to student achievement in obtaining licensure," the filing said.

Some observers have wondered whether the Trump administration might change course on ACICS, given its stated interest in rolling back federal regulations. But the ACICS decision, which several state attorneys general have backed in court, would be a difficult one to reverse, experts said.

Most of the 245 institutions overseen by ACICS have begun attempting to find a new accreditor, with the Accrediting Commission of Career Schools and Colleges saying in January that it expected to receive 210 applications from ACICS institutions by the end of that month.

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Purdue acquires Kaplan University to create a new public, online university under Purdue brand

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Indiana institution acquires Kaplan University and its 32,000 students in an unprecedented move to enter online education as many large for-profits continue to slump.

Purdue Buys Kaplan University, Will Create New Nonprofit Chain

In an unprecedented move, a public research university, Indiana's Purdue University, is buying Kaplan University, a large for-profit chain with a mostly online footprint.

The deal will lead to the creation of a new nonprofit institution, which under some as yet undetermined form of Purdue's name will offer credentials ranging from certificates to doctoral degrees, online and at 15 campus locations.

Kaplan currently enrolls 32,000 students and employs 3,000 faculty members and other staff. All will transition to the new Purdue subsidiary. Kaplan's parent company, Graham Holdings, is publicly traded and, until a few years ago, was the owner of The Washington Post.

Purdue has in recent years won fans and faced some controversy for entrepreneurial moves led by its president, former Republican governor of Indiana Mitch Daniels Jr. The university said the former Kaplan University would become a nonprofit called New University (the name Purdue is using for now), which will operate as a wholly owned subsidiary of the public university. The remaining Kaplan Inc., which already sells a range of mostly technology related services to nonprofit colleges, will continue to provide nonacademic support to the new nonprofit under an agreement with a 30-year term, with a buyout option after six.

Terms for the deal include only a "nominal" up-front payment, according to a corporate filing. "Kaplan is not entitled to receive any reimbursement of costs incurred in providing support functions, or any fee, unless and until New University has first covered all of its operating costs," the filing said.

Like most large for-profits, Kaplan's holding company has in recent years struggled with declining enrollments and unflattering attention from federal and state regulators. For example, Kaplan Higher Education in 2015 paid $1.3 million to settle a federal whistle-blower's allegations that the company employed unqualified instructors. Yet Kaplan University, which is separate from the former Kaplan Higher Education campus involved in that lawsuit, still has a large infrastructure that will allow Purdue to immediately be a major player in online education. Purdue will join several nonprofit institutions that are increasingly dominating online education, including Arizona State, Liberty, Southern New Hampshire and Western Governors Universities.

“None of us knows how fast or in what direction online higher education will evolve, but we know its role will grow, and we intend that Purdue be positioned to be a leader as that happens,” Daniels said in a written statement. “A careful analysis made it clear that we are very ill equipped to build the necessary capabilities ourselves, and that the smart course would be to acquire them if we could. We were able to find exactly what we were looking for. Today’s agreement moves us from a standing start to a leading position.”

The Kaplan news follows several dramatic changes for large, publicly traded for-profits, including the collapse of the controversial ITT Technical Institute and Corinthian Colleges, the sale of the University of Phoenix to private investors, and the so-far unsuccessful attempt by Grand Canyon University to go nonprofit, with the company saying it wants to avoid the "stigma" for-profits face.

Likewise, Education Management Corporation, a major for-profit chain, last month sold to the Dream Center Foundation, a religious missionary group, that plans to run the former EDMC as a secular, nonprofit institution. And a large chunk of the remains of Corinthian was purchased less than three years ago by ECMC Group, a student loan guarantee agency, that created the Zenith Education Group as a new nonprofit career college chain.

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Higher ed observers call James Manning a steady hand at Department of Education

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James Manning, acting under secretary of education, receives praise from Republicans and Democrats with government experience for his knowledge of the Department of Education and aid programs.

University of Phoenix Hires New President

The University of Phoenix announced Tuesday that it has hired Peter Cohen as the university's president. Cohen arrives from McGraw-Hill Education, where he most recently has been the company's executive vice president. He previously was president of Pearson Education's school division.

Phoenix is a large for-profit chain that in recent years has struggled with slumping student enrollment and revenue. In addition, last year the university disclosed that some of its academic programs do not pass the federal government's gainful-employment rule.

Also last year, Apollo Education Group, Phoenix's holding company, announced it would eliminate the use of mandatory arbitration clauses in student enrollment agreements as part of a broader effort to improve student graduation and default rates. Apollo also cut most of its associate degree programs and the use of third-party marketing.

"At every step in my career, I have sought ways to make education more engaging, accessible and impactful," Cohen said in a written statement. "It’s a thrill and an honor to continue pursuing this goal at University of Phoenix, a flagship institution of higher education."

Cohen follows Timothy Slottow, a former official at the University of Michigan who led Phoenix for about three years before stepping down last month.

Apollo in February was purchased by a group of private investors for $1.14 billion. The deal was approved by the federal government and an accreditor amid some controversy, in part because of the role of Tony Miller, a former official in the Obama administration's Education Department. Miller is COO and a partner of the Vistria Group, one of Apollo's new owners, and is now chairman of the company's board.

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Department of Education makes first official senior hires

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Education Secretary Betsy DeVos makes first official announcement of key aides, many of them in acting capacities and including some controversial choices.

TICAS President to Step Down

Lauren Asher, president of the Institute for College Access and Success, said Tuesday she will step down as head of the organization after June.

Asher has spent 12 years at the nonprofit organization, serving as president since 2009, when the TICAS board named her to replace Bob Shireman.

She said the group had grown "from a scrappy start-up to a central voice" on issues such as student loan and financial aid policy and access to college.

"I’m so proud of what we’ve accomplished together and the organization TICAS has become," she said in a message announcing her departure. "And our student-centered, data-driven and outcomes-oriented approach to financial aid policy and practice is needed now more than ever. I know TICAS will continue to have a major impact: fighting to make education and training more affordable and successful, not less, and standing up for the most economically vulnerable students and borrowers."

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More online courses at public and private colleges, but pace slowing

Colleges and universities continue to expand their online course and degree-program offerings, especially at the graduate level. But fierce competition has tamped down the once-frantic pace of growth.


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