OAKDALE, Minn., Nov. 20, 2014 /PRNewswire-USNewswire/ -- ECMC Group today announced that it has entered into an agreement to acquire 56 Everest and WyoTech campuses from Corinthian Colleges Inc. and transition them from for-profit to nonprofit status. ECMC Group, a nonprofit corporation with a long-standing mission of helping students succeed, intends to transform the culture and education model at the acquired schools, including lowering tuition and introducing strict accountability standards for program completion and job placement rates.
Had this agreement not been reached, Corinthian would have been forced to close the schools upon the termination of its temporary operating agreement with federal authorities. The closing of this transaction is contingent on a number of conditions, including federal and state regulatory approvals. The sale would allow more than 39,000 students to complete their educational programs without interruption and creates the largest nonprofit career college system in America.
"This is an extraordinary opportunity for us to make a difference in career education by offering students a new path for gaining the in-demand skills and training that employers are seeking," said David Hawn, president and CEO of ECMC Group. "We are bringing our resources to bear to transform Everest and WyoTech into schools that are synonymous with student success – measured by strong program completion and job placement rates."
Though the U.S. Department of Education will need to approve the final sale, upon completing the acquisition, ECMC Group will begin making major changes to the current model in four core areas:
- Affordability: ECMC Group will work to improve affordability by reducing tuition by 20 percent for new students in most Everest programs, effective immediately upon closing. Existing students who enroll in additional courses will also benefit from this reduction. The Company further plans to award millions of dollars each year in institutional grants to fill gaps in funding so that students will not be forced to take out private loans.
- Accountability and Transparency: ECMC Group will ensure that two key measures of student success are met: strong program completion rates and job placement rates. ECMC Group intends to transform the culture of the campus system by bringing on a new senior executive team and through a new strategic focus on educational programming and the overall student value proposition. The Company will also expand oversight by consolidating and centralizing all compliance, quality control and internal audit functions under ECMC Group's purview. ECMC Group will also employ a monitor to oversee its regulatory obligations related to the acquired schools. Additionally, ECMC Group plans to provide students easy access to more information about their educational programs, relevant placement rates, and other measures of their likely success.
- Improved Job Placement: ECMC Group and campus leadership will coordinate with local and regional employers to ensure that skills being taught in the classroom reflect actual workforce needs and will lead to jobs in their field of study. ECMC Group will also lead a comprehensive review of all programs with a goal of improving and, if warranted, eliminating those that underperform. Students in specific underperforming programs will be given a choice of options, including a refund of loans that would be funded by ECMC Group.
- Individualized Support: ECMC Group will maintain smaller class sizes to
re-emphasize quality learning over enrollment. Additionally, ECMC Group will improve academic counseling, tutoring, and remedial education services to ensure that more students have the tools and resources required for successful program completion; financial literacy counseling to help students better manage their student loans and reduce student loan debt; and career counseling services to provide clear paths to good jobs related to their fields of study.
"As a student loan guaranty agency for the last 20 years, we've seen firsthand how high debt, poor completion rates and unsatisfactory job placement rates can disproportionately impact students attending certain for-profit schools," continued Hawn. "In becoming the largest nonprofit career college system in America, we see a tremendous opportunity to help more Americans access the high-quality education necessary to enter into prosperous and fulfilling careers – without accumulating excessive debt."
ECMC Group plans to oversee the direction and management of this action plan through its newly launched education subsidiary, the nonprofit Zenith Education Group, run by a new executive team and operating according to a new set of standards for business ethics, enhanced student educational experience and employee conduct.
The transaction is expected to close in January. For a list of campuses included in the acquisition, please visit http://ecmc.org/Group/acquired-school-list.pdf.
About ECMC Group
ECMC Group is a nonprofit corporation with a mission to help students succeed. All companies in the ECMC Group family work together to fulfill this mission through product and service support and by funding its philanthropic activities through ECMC Foundation. Educational Credit Management Corporation (ECMC), a nonprofit subsidiary of ECMC Group, is one of the largest student loan guaranty agencies in the United States. ECMC has invested heavily in programs promoting financial literacy, college access and college completion. ECMC has also worked tirelessly to lower student loan default rates and provide resources to support student loan borrowers in successfully repaying their loans. As part of its commitment to student success and education debt management, it recently acquired the free online tool College Abacus, an innovative technology that increases college cost transparency and helps students better understand their financial aid options at all types of colleges including career colleges.
SOURCE ECMC Group