Blackboard Considers Purchase Offers

April 20, 2011

Blackboard, the e-learning giant, announced on Tuesday that it has received "unsolicited, non-binding proposals" to be bought out. The company, which is publicly traded, appears to be taking the offers seriously; it has retained the investment firm Barclays Capital to help it figure out whether it wants to sell. Blackboard's stock leaped by nearly 30 percent with the news.

The entity that has proposed to acquire Blackboard is not known. Scott Berg, a research analyst with the investment bank Feltl and Company, told Inside Higher Ed he thinks it is unlikely that the suitors would be other software companies, since the software products Blackboard sells -- online learning platforms, emergency notification systems, and data analytics tools, among others -- would not make an obvious addition to the arsenal of any other software firm. (The only software-related companies Berg speculated might make a bid for Blackboard are Microsoft and Pearson. Neither of those companies elected to comment.) It is more likely that a potential suitor would be a private equity firm, Berg said, in which case the consequences for Blackboard's many higher-ed customers would be difficult to predict.

Kenneth C. Green, director of the Campus Computing project, speculated that an acquisition could mean increased costs for colleges. “Blackboard has been aggressive in buying other firms,” Green wrote in an e-mail, “more than half a billion dollars in acquisitions since 2006…. That's a lot of debt to pay down, and more debt is likely to come following an acquisition. All of which suggests that the company's new owners will be looking for new revenue, which could well mean price increases across the range of Blackboard's current product lines and services.”

This article in The Financial Times explores reasons some companies may or may not be likely to be making a bid for Blackboard. Joshua Kim, who writes the Technology and Learning blog for Inside Higher Ed, has written in the past why a Blackboard purchase would make sense for either Microsoft or Google.

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