Dive Brief:
- Education Management Corp will sell several of its high-profile institutional brands to nonprofit the Dream Center, pending federal approval.
- Argosy University and the Art Institutes will transition out of the embattled for-profit company.
- All classes will resume under the new management, and no faculty and staff will be cut as a result of the sale to the faith-based organization which seeks to provide educational training for underprivileged citizens.
Dive Insight:
Along with Corinthians Colleges and ITT, EDMC was among the bigger for-profit education brands plagued by lawsuits and federal inquiry into postgraduate outcomes of millions of students. Many institutions, not just for-profit schools, face the prospect of having to determine what to do with assets as enrollment and funding are declining and debts are mounting. Boards and presidents can look at examples of schools like Missouri College and St. Joseph's College as a blueprint for how not to handle closure and how to avoid the pitfalls in communicating with alumni, faculty, students and other stakeholders.
In the case of the EDMC institutions, operations will seemingly resume as normal, but in many recent cases, the end result is closure. There is no ideal way to tell stakeholders that an institution will close, but there are many ways to share exit strategies for continuing education, possible career counseling and asset distribution to give all involved a fair chance of continuing life without major disruption.
