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Hilbert College to acquire for-profit health care company

 

Brief description of the dive:

  • Hilbert College, a small Franciscan college in western New York, on Wednesday announced plans to acquire Valley College, a non-profit organization with educational centers in West Virginia and Ohio.
  • The colleges will operate independently under a new non-profit parent organization called Franciscan Services. They plan to establish transfer paths between the two colleges’ online programs and explore shared services to cut costs.
  • Together, the two colleges will serve over 2,000 students. Both institutions have seen a recent increase in enrollment, thanks to new online and athletics programs that saw an increase in enrollment last year at Hilbert. With an enrollment of approximately 1,000 students, Valley College has grown steadily over the past decade.

Immersion:

The deal brings together colleges with vastly different student populations. More than half of Valley College’s students study online, and its four educational centers primarily serve adult students, who are generally considered to be those aged 25 and over.

According to the announcement, Hilbert has 750 students studying in-house, while about 150 are enrolled in master’s programs or study online. About 9 out of 10 college students are under the age of 24, according to federal data.

As a small private non-profit organization, Hilbert is also part of a group of higher education institutions facing major economic challenges. These include pressure to offer tuition discounts to encourage students to enroll, and an expected decline around 2025 in the traditional student-age population due to declining birth rates during the Great Recession.

According to the statement, the deal is designed to address some of those concerns.

“Through this strategic acquisition, both Hilbert College and Valley College address changes affecting higher education, including declining high school graduation rates, increasing workforce development needs, and regional and national trends in higher education,” said Valley College President Tony Palmieri in his report. statement.

Hilbert was at the forefront of some of these issues. In fiscal year 2016, Gilbert earned $16.6 million in tuition and fees, but awarded $4.1 million in scholarships, according to an audited financial statement. This means that the institution gave away about 25 cents for every dollar collected.

By fiscal year 2021, that amount has risen to about 42 cents for every dollar raised, even though college enrollment has declined over that period. That same year, Gilbert brought in $17.4 million in tuition and fees, but squandered $7.3 million in financial aid.

However, enrollments at Gilbert have increased recently, an increase officials attribute in part to new online programs. Gilbert had 900 students enrolled in the fall of 2022, according to Michael Brophy, president of the college. This is up from 784 students a year earlier.

Brophy believes the acquisition will help Hilbert and Valley become stronger institutions, including by increasing the purchasing power of resources such as technology and textbooks. This combined strength can help prevent some of the problems that plague small colleges.

“Small classes are good, small consultations are good,” Brophy said. “But on a college scale, that doesn’t work. Small colleges are going through a very difficult time.”

Brophy suggests that a partnership will develop between Gilbert and Valley, which he expects will eventually turn from commercial to non-commercial as a result of the deal.

The two institutions could also help each other develop more effective programs. Valley, for example, specializes in related programs in health and medical sciences, and Gilbert could use the institution’s experience to earn his own degrees in these areas in the future.

The acquisition of Valley College must be approved by the state, federal government, and an accredited body. Officials hope the deal will close this spring. A spokesman declined to share financial details of the acquisition.

Similar deals have attracted other private non-profit colleges. Saint Joseph’s University, a Jesuit institution in Philadelphia, recently announced plans to acquire the Pennsylvania College of Health Sciences, another nonprofit in the state.

The expansion will allow the university to expand its footprint and add more than 20 programs in the related fields of health and nursing. This acquisition marks St. Joseph’s second bequest in less than two years.

In recent years, other non-profit organizations have also sought to acquire for-profit colleges. In 2021, the University of Arkansas System approved the acquisition of Grantham University, then an online for-profit company, to expand its virtual offerings.

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