The Idaho State Board of Education has approved the University of Idaho’s (U of I) purchase of the University of Phoenix for $550 million.
U of I officials believe the acquisition of the University of Phoenix will bring in $10 million in annual revenue, reports Boise Dev.
Idaho State Board of Education Member Kurt Liebich said in an Idaho Statesman editorial that he believes the purchase will position U of I to weather hard times. He said demographic trends indicate traditional college-age student numbers will soon dramatically drop, and that the University of Phoenix’s online platform will soften that blow by helping U of I attract adults interested in going back to college or receiving additional training.
Although student enrollment at the University of Phoenix at one point exceeded 450,000, it has faced challenges to its reputation recently. In 2019, the school was sued for $191 million by the U.S. Federal Trade Commission for allegedly engaging in deceptive advertising strategies. The lawsuit also alleged the University of Phoenix “made false claims about post-graduation job opportunities for students,” reports Boise Dev. However, since then, the school has worked to improve its reputation under Apollo Global Management and other institutional investors, reports AZCentral.
The University of Phoenix currently enrolls about 85,000 students.
U of I’s deal also faced scrutiny because the Idaho State Board of Education approved the transaction only one day after it was announced.
The University of Phoenix will be converted from a for-profit institution to a not-for-profit institution, and public tax dollars “will not be used in the transaction,” says Liebich.
The University of Arkansas previously considered buying the University of Phoenix but recently rejected the proposal.
