Laureate Education has registered an amended Form S-1 with the U.S. Securities and Exchange Commission (SEC) for its initial public offering (IPO). No terms were given in the filing, but the offering is valued up to $100 million, although this number is usually just a placeholder. The company has not yet determined which exchange to list its shares on, but it does plan to list under the symbol LAUR.
The underwriters for the offering are Credit Suisse, Morgan Stanley, Barclays, JPMorgan, BMO Capital Markets, Citigroup, KKR and Goldman Sachs.
This is the largest global network of degree-granting higher education institutions, with more than a million students enrolled at 88 institutions in 28 countries on more than 200 campuses, which the company collectively refers to as the Laureate International Universities network. It participates in the global higher education market, which is estimated to account for revenues of approximately $1.9 trillion in 2015, according to GSV Advisors.
The company believes the global higher education market presents an attractive long-term opportunity, primarily because of the large and growing imbalance between the supply and demand for quality higher education around the world. Advanced education opportunities drive higher earnings potential, and Laureate believes the projected growth in the middle class population worldwide and limited government resources dedicated to higher education create substantial opportunities for high-quality private institutions to meet this growing demand.
Laureate described its finances as follows:
Our track record for delivering high-quality outcomes to our students, while stressing affordability and accessibility, has been a key reason for our long record of success, including 15 consecutive years of enrollment growth. We have generated compound annual growth rates (CAGRs) in total enrollment and revenues of 11.9% and 11.7%, respectively, from 2009 through September 30, 2015. For the LTM ended September 30, 2015, we generated total revenues of $4,470.4 million, approximately 80% of which was from private pay sources, operating income of $332.9 million, net loss of $252.1 million and Adjusted EBITDA of $803.9 million.
The company intends to use the net proceeds from the offering to repay certain of its outstanding indebtedness and for general corporate purposes, which may include working capital.