Dive Brief:
- Grand Canyon University President Brian Mueller has indicated the institution, more likely than not, will remain a publicly traded company.
- Shareholders have been offered a 15% premium on a buyout, but after years of consistent gains, they’re not taking it, the Phoenix Business Journal reports.
- Mueller said the university will pay $100 million in taxes next year, according to the article, and that affects GCU’s ability to compete against nonprofit schools that don’t have a tax burden.
Dive Insight:
Grand Canyon University opened in 1949 as a nonprofit liberal arts college but shifted models in 2004 when Grand Canyon Education Inc., purchased it. GCU has more in common with the traditional colleges and universities that used to be its peers and it hasn’t faced as severe a scrutiny as online for-profit schools like the University of Phoenix. Investors have seen steady gains on their investment and are hesitant to take a buyout that would deprive them of future returns.
A handful of for-profit colleges and universities have made the switch but it’s certainly not common — although increasing regulations under the Obama administration have made the idea more enticing. But now there’s extra scrutiny on that move, too.
