Less than a year after HarperCollins purchased the trade division of Houghton Mifflin Harcourt, a private equity firm has made an agreement to acquire the learning technology company, HMH announced today.
Veritas Capital will acquire the Houghton Mifflin Harcourt Company in a deal expected to be completed in the second quarter. HMH is currently a public company, and shareholders will be entitled to receive $21 in cash per share through a tender offer that prices the share price at a a 36% premium, implying an equity value of approximately $2.8 billion. On Sunday, Bloomberg reported that Veritas could merge HMH with its portfolio company Cambium Learning Group should the bid be finalized.
Jack Lynch will remain president and CEO of HMH. The rest of the current management team, the company said in a statement, will remain in place.
"With accelerating billings growth, strong free cash flow and a transformed cost structure, we are at an important inflection point, and the time is right to move into the next phase of our long-term growth strategy alongside a partner that brings significant industry expertise." Lynch said in a statement. "As the promise of digital learning increasingly takes hold across the nation, we are confident this transaction will deepen our ability to bring the power of learning to even more teachers and their students, invest in our purpose-driven team, and have a positive impact on the communities we serve."
According to Publishers Weekly's stock index, HMH stocks had a banner year in 2021, rising $12.77 per share between December 31, 2020, and the same date the following year—a whopping 383.5% increase. HMH's fourth-quarter and full-year financial results for 2021 will be released this Thursday, but its previously scheduled earnings conference call will not be held.
