Blackboard to Buy Rival E-Learning Firm By Alejandro Lazo Washington Post Staff Writer
Thursday, May 7, 2009 http://www.washingtonpost.com/wp-dyn/content/article/2009/05/06/AR2009050603933_pf.html Blackboard, the maker of software used by colleges to put lectures online, said yesterday that it expects to acquire one of its main competitors, Angel Learning of Indianapolis. The District-based company, whose e-learning software is ubiquitous on many university campuses, will pay about $95 million -- $80 million in cash and $15 million in stock -- for its rival, excluding transaction costs and including the cash it will acquire from privately held Angel. The deal is expected to close this month, Blackboard said. The announcement came as Blackboard released its financial results for the first quarter, posting a narrower loss of $37,000 for the first three months of the year, compared with a loss of $4.4 million in the first quarter of 2008. In an interview, Blackboard chief executive Michael L. Chasen said that combining the two companies, whose technologies are similar, will allow his firm to continue to grow quickly and improve its customer service and technology. Chasen said that some staff cuts will be made where there are redundancies in the two companies but that no large layoffs are planned for the immediate future. "We are adding to our bench strength, we are adding people that have expertise in educational technology, and also a product with some great functionality that we can incorporate into our longer-term product strategy," he said. "On their side, they are merging with a company that is financially stable and is growing and has a lot of revenue to invest in R and D." In a statement, Angel's president and chief executive, Christopher Clapp, said that the two companies could "leverage our respective strengths to improve teaching and learning worldwide." Blackboard's software allows students to register for classes, take quizzes, submit assignments and view lectures online. Universities pay the firm an annual subscription fee to use the software. Angel has a similar business model. Blackboard also provides software for high school, middle school and elementary school students, though that part of the business has been harder hit by the economic downturn as states cut back on school budgets. "The budget constraints at the K-12 level typically come from state and local tax receipts, which over the last couple of quarters have been a little bit rocky," said Michael B. Nemeroff, an analyst with Wedbush Morgan Securities. "At the higher-education level, the budgetary constraints a lot of times come from the endowments of the schools, which have also had some pretty tough times, but Blackboard has done pretty well despite the weakness as their product is core to the learning environment at the schools." Blackboard has expanded its core services of putting course material online in recent years. Last year the company bought NTI Group for $182 million, adding technology that sends emergency alerts to primary schools and university students. -- ================================ George Antunes, Political Science Dept University of Houston; Houston, TX 77204 Voice: 713-743-3923 Fax: 713-743-3927 Mail: antunes at uh dot edu *********************************** * POST TO MEDIANEWS@ETSKYWARN.NET * *********************************** Medianews mailing list Medianews@etskywarn.net http://lists.etskywarn.net/mailman/listinfo/medianews
