BRIEF Activist investors urge Adtalem to pull plug on Walden U purchase
Natalie Schwartz
January 21, 2021
Dive Brief:
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Activist investors are calling on Adtalem Global Education to try to end its planned purchase of Walden University, a for-profit online college.
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Two investment firms, Engine Capital and Hawk Ridge Partners, wrote in an open letter dated Thursday that they were “severely disappointed” with the board’s decision to purchase Walden, calling the college a “substantially inferior asset.”
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They suggested that a federal investigation into Walden over allegations it misrepresented one of its programs gives Adtalem an opening to abandon the deal.
Dive Insight:
Adtalem announced plans in September to buy Walden for $1.5 billion in cash from the university’s parent company, Laureate Education. Officials at the acquiring company billed the deal as a way to help meet the growing need for healthcare workers.
A few days later, Laureate told Adtalem that the U.S. Department of Justice and several other government agencies were investigating whether Walden misrepresented aspects of its nursing program to students and an accreditor, according to SEC filings.
Adtalem launched its own probe into the allegations and is evaluating whether the situation will impact the deal, Lisa Wardell, the company’s CEO, told analysts in November.
