A publicly traded Phoenix company announced Tuesday that it has agreed to buy Carmel-based Orbis Education Services LLC, which markets and manages health care education programs for academic institutions and health care systems, for $362.5 million in cash.
The buyer is Grand Canyon Education, which designs programs to support students in undergraduate, graduate and doctorate programs and has nearly $1 billion in annual revenue.
Orbis—founded in 2003 by Daniel Briggs, who now serves as the company's chief growth officer—is one of the city's most closely watched education-technology firms. Between 2010 and 2012, it raised more than $32 million in outside funding, with much of the capital coming from the Philadelphia private equity firm LLR Partners.
Orbis supports health care education programs for 17 regionally accredited universities across the United States. It creates partnerships between those institutions and employers by managing clinically intensive pre-licensure health care programs through a hybrid learning model that incorporates online coursework, off-campus laboratory facilities where students can practice clinical skills, and guaranteed placements with employers.
A nationwide shortage of health care professionals has helped fuel Orbis' growth.
Brian Mueller, Grand Canyon Education’s CEO, said his company can further stoke the growth by providing capital and advanced technologies.
"There is a significant shortage of health care professionals in this country due to the aging baby boomer population and impending retirements of many in the nursing profession," Mueller said in written comments. "These are noble and well-paying professions that many students are interested in, yet many universities are forced to turn away qualified applicants due to budget constraints, a shortage of faculty and an insufficient amount of clinical sites and classrooms. Orbis has been very innovative in providing scalable solutions for universities across the country.”
Orbis' partners include Marian University, Loyola University Chicago, Marquette University in Milwaukee and Concordia University in Portland, Oregon.
Grand Canyon Education, which describes itself as a pioneer of the hybrid campus model, said it is one of the largest providers in education services, thanks to its partnership with Grand Canyon University, a not-for-profit Christian university with enrollment of more than 95,000 students.
GCE created the infrastructure that allowed Grand Canyon University to grow from 900 traditional students on its campus to about 20,500 in 10 years. Over the same period, online enrollment grew to more than 75,000.
"Grand Canyon Education is an excellent fit for Orbis and provides a transformational opportunity for our academic and health care partners as well as our employees," Orbis CEO Steve Hodownes said in written comments.
Hodownes became CEO of Orbis in 2015.
Phoenix-based DLA Piper LLP is serving as outside corporate counsel to GCE in the transaction. Barclays Capital Inc. is serving as financial adviser to GCE.
Philadelphia-based Morgan Lewis & Bockius is serving as outside counsel to Orbis Education in the transaction. Australia-based Macquarie Capital is serving as financial adviser to Orbis Education.
The deal is expected to close during the first quarter of 2019.