At a time when you might have expected to hear the youth of Brazil chanting about the nation’s football team, they called out “Vem pra rua” – “Come to the street” – an invitation to protest against corruption, police aggression and poor public services.
It’s been a busy time for the education sector in the Brazilian stock market. In less than a week, two large groups of private universities have filed for initial public offerings, which together could raise as much as R$1.6 billion (US$730 million). But there’s more action than IPOs. This year, three mergers and acquisitions of major education companies also shook up the sector, which is making big bets on online distance learning.
Profit-making in higher education engages controversial issues and debates involving the proper bounds of market activity. While it is widely recognised that many non-profit institutions engage in profit-making, this article deals with those institutions that are legally allowed to distribute revenues among shareholders and specifically focuses on Brazil – one of the world’s largest higher education for-profit sub-sectors.
Education firms Anhanguera Educacional Participacoes SA and Kroton Educacional SA were added to Brazil's benchmark Ibovespa stock index for the period between Sept. 2 of this year and Jan. 3, 2014, exchange operator BM&FBovespa said on Monday.
Rice University’s first dual-degree doctoral program with the Universidade Estadual de Campinas (UNICAMP), located in Brazil, was approved by the Faculty Senate on Nov. 14.
Estacio began 2013 with a new record for student enrollment. There were 117,000 more new on-campus and distance learning college students matriculated in the first quarter of 2013, an increase of 23% compared to the same period last year. With this, Estacio ended the matriculation period for 1Q13 with a total student base of 334,200 undergraduate and graduate students, 19.9% above what was recorded for the same quarter in 2012, of whom 270,500 were matriculated for on-campus programs, and 63,700 in distance learning programs. Not including acquisitions made in 2012, the student base grew organically by 16.8%.
It has been a busy time for the education sector in the Brazilian stock market. In less than a week, two large groups of private universities have filed for initial public offerings, or IPOs, which together could raise as much as R$1.6 billion (US$740 million). This year, three mergers and acquisitions of major education companies also shook up the sector, which is making big bets on online distance learning, writes Patricia Gomes for edSurge.
There are strong indications that demand for higher education is outstripping supply. In January, Gloria Sekwena died and at least 20 other people were seriously injured when about 5,000 people stampeded in a desperate attempt to register at the last minute with the University of Johannesburg. The university received more than 85,000 applications for fewer than 12,000 places last year.
Universities in Brazil have long been for the privileged few. Only 11% of the population of working age has a degree – and such scarcity has brought rich rewards. Graduates earn, on average, 2.5 times more than those without degrees, and five times as much as the majority who never finish secondary school, reports The Economist.
For-profit universities in Brazil are benefiting as rising incomes and greater access to credit boost demand for higher education in Latin America’s largest economy, where fewer than 1 in every 10 Brazilians has a college degree.
Anhanguera Educacional Participacoes SA (AEDU3), Brazil’s largest for-profit university, and its two biggest Brazilian competitors are beating global peers after student loans tripled when the government reduced interest rates and made repayment easier.
One consequence has been the expansion of private higher education options in Brazil. While private universities affiliated with the Catholic Church date back to the 1600s, they have, particularly since the 1990s, made significant strides in strengthening curricula and becoming more engaged at home and internationally. PUC-Rio, a Jesuit-affiliated university, has become one of the most internationally recognized institutions of higher education in Brazil. Mackenzie Presbyterian University, founded by an American attorney at the end of the 19th century, is another private not-for-profit institution that enjoys a strong reputation abroad. Additionally, Brazil has one of the world’s most important academic think tanks, Fundacao Getulio Vargas (FGV), which trains public and private sector managers, and also engages in world-class policy research, often in collaboration with some of the world’s top universities.
Laureate Education Inc, a for-profit higher education provider that boasts former U.S. President Bill Clinton as honorary chancellor, is planning to launch an initial public offering, according to people familiar with the matter.
DeVry Inc.'s CEO Daniel Hamburger said Thursday that he sees better times ahead for the for-profit education company given a recent acquisition, cost-cutting measures and improving enrollment trends at some of its schools.
Recently DeVry Inc. (DV - Analyst Report), one of the largest providers of higher-education in North America, acquired Faculdade do Vale do Ipojuca (“FAVIP”). FAVIP, which is based in Fortaleza, Ceará, Brazil will form a part of DeVry Brasil.
Rosemir Soares always wanted to go to university but could never afford the fees. Then she discovered Prouni, a scholarship program of the Brazilian government that has guaranteed a college education for more than one million low-income students since it began, in 2005.
A burning question for developing countries is whether low quality private higher education is better than none at all, in circumstances where public systems cannot meet soaring student demand. Brazil decided it was and set about rapidly expanding its higher education system, including by opening it to private institutions. Today the country has one of the largest private sectors in the world and it enrols a staggering 75% of all post-secondary students.
A growing number of Brazilians are willing to pay to get an education, and for-profit schools, both local and international, are rushing to oblige them.