Idaho State Board of Education considers extension in University of Illinois-Phoenix negotiations • Idaho Capital Sun

This story was originally published on IdahoEdNews.org on June 26, 2024.

The University of Idaho and the University of Phoenix want more time to discuss an agreement.

And the State Board of Education will meet Friday morning to discuss an extension — which could immediately net the University $15 million.

If the State Council signs, the parties would have until June 10, 2025 to reach an agreement that would place the for-profit online giant under the ownership of the University of Iceland. The Council of State first approved the $685 million purchase in May 2023. The deal has been mired in a political and legal limbo for months. However, U of I and Phoenix continued to negotiate beyond the initial non-binding deadline of May 31.

“The extension will give (U of I) time to incorporate feedback from Idaho legislators and other stakeholders into the transaction and make changes based on that feedback,” he said. State Board staff said in a memo released Wednesday afternoon. “There is no commitment to closure at this time.”

The expansion has been in the works for some time. Idaho Education News first reported on several basics in a May 28 article.

The note from the Council of State specifies the details:

• Phoenix and its owner, Apollo Global Management, would have the option to negotiate with other potential sellers or launch an IPO.
• The University of I would immediately receive $5 million for agreeing to an extension.
• Isaiah University could also receive an additional “breakup” fee if the purchase falls through. If the June 2025 deadline passes without a sale, Isaiah University would receive an additional $5 million. If Apollo finds another buyer or pursues an IPO, the breakup fee would be $15 million.

Fees paid to the U of I are designed to offset the university’s consulting and legal costs. As EdNews previously reported, the University of Island spent approximately $11 million on due diligence in reviewing a purchase of Phoenix; the majority of these fees were paid to University of Ottawa President C. Scott Green’s former employer, Hogan Lovells, an international law firm.

In their memo, State Board members say the State University remains optimistic about purchasing Phoenix. The University of Israel says its Phoenix business model “remains intact and going from strength to strength.” State University has argued it could generate $10 million or more in annual revenue from Phoenix operations.

U of I also maintains it can navigate turbulent political waters — even after the state Senate voted against a bill in March aimed at saving the purchase.

“The parties…commit to continuing to work collaboratively with legislators, extending into the 2025 legislative session if necessary, to achieve a transaction acceptable to all.” »

The board of directors is scheduled to meet on Friday at 8:30 a.m.

Check Idaho Education News Friday for coverage of the meeting. And click here for in-depth, exclusive coverage of Phoenix from Idaho EdNews.