College accreditation agency the Higher Learning Commission has approved the $1.1 billion sale of Apollo Education Group to a group of investors. The group is the parent company of for-profit institutions University of Phoenix, Western International University and College for Financial Planning.
The Washington Post reported that the commission informed Apollo on Monday that the application filed by the for-profit institutions has been approved. This was to make sure that the colleges are still accredited even after investors take over the parent company.
The University of Phoenix, Western International University and College for Financial Planning are required to submit quarterly reports to the commission. It should include details on enrollment, quarterly financials and student retention rates.
Apollo confirmed that the commission's go signal is the last needed educational regulatory approval. The deal is expected to be completed by next month, as long as all other closing conditions have been satisfied.
According to Politico, the sale may be completed by Feb.1. The investors that will buy the Apollo Education Group include Apollo Global Management, Najafi Companies and the Vistria Group.
The sale sparked controversy about potential conflicts of interest since the group of investors who intend to purchase the school have ties to the Obama administration. One of them was former Deputy Education Secretary Tony Miller.
Private equity firm Vistria Group is run by former President Obama's longtime friend Marty Nesbitt and Miller. One of them is set to become chairman of Apollo Education after the deal has been completed.
There were concerns that the University of Phoenix sale will not push through. It was also slammed with big demands from the Department of Education for approval.
The conditions of the approval were described as very "exacting" that it could see investors walking away from the agreement without legal issues. Prospective owners of the institution would need to meet the demands in order for the school to continue receiving student aid funding from the federal government.
One condition required the soon-to-be owners of the University of Phoenix to come up with a $385.6 million letter of credit. Another was that they are not allowed to expand the school's enrollment.
