Apollo Education Group

Apollo Education Group is an American education company whose historical center of gravity was for-profit higher education for adult, working, and otherwise non-traditional learners. Founded in 1973 by educator and economist John Sperling and John D. Murphy, the company developed around the idea that higher education could be organized around students who needed flexible schedules, distance learning, and career-oriented programs rather than the residential model traditionally associated with American universities. Its best-known institution was the University of Phoenix, founded in 1976 and built around evening, distance, and later online instruction for working adults. The corporate group expanded substantially as Apollo Group, becoming a publicly traded education company in the 1990s. University of Phoenix remained its principal asset, but the group also assembled a portfolio of institutions and education businesses spanning professional education, online schooling, instructional technology, marketing, and international markets. Holdings and investments at different times included Western International University, the College for Financial Planning, BPP Holdings in the United Kingdom, Universidad Latinoamericana in Mexico, Open Colleges in Australia, Carnegie Learning, Insight Schools, Meritus University in Canada, The Iron Yard, Aptimus Marketing, and other education-related operations. Through Apollo Global, a joint venture with The Carlyle Group, Apollo also pursued international acquisitions and investments. The company grew rapidly during the expansion of the American for-profit college sector, but its operating environment became more difficult in the 2010s. Enrollment and revenue declined, competition from public and nonprofit institutions increased, and regulators, legislators, journalists, and investors scrutinized recruitment practices, student outcomes, tuition, debt, marketing, and military recruitment. The University of Phoenix was particularly prominent in these debates because of its scale and reliance on open-enrollment and online delivery. Apollo faced litigation and regulatory investigations connected with alleged disclosure failures and educational-marketing practices. It also managed a portfolio that was increasingly rationalized through closures and divestitures, including the closure of Meritus University and Western International University and the sale of several other businesses. In 2016, shareholders approved a sale of Apollo Education Group to a private-investor consortium involving The Vistria Group, Apollo Global Management-affiliated funds, and the Najafi Companies. The transaction was completed in 2017, and the company was delisted, ending its period as a public corporation. The private ownership structure reduced the level of regular public financial disclosure. Apollo Education Group should not be treated as another name for the University of Phoenix: Apollo was the corporate owner and portfolio group, while the University of Phoenix was its most prominent educational subsidiary. The group’s assets, subsidiaries, and ownership arrangements changed over time, so historical descriptions should be tied to the relevant period rather than assumed to describe the present portfolio.

Apollo Education Group originated in 1973, when John Sperling and John D. Murphy established an education company centered on non-traditional higher education. Its model addressed adults and working students who needed programs compatible with employment and family responsibilities. The University of Phoenix was established in 1976 and became the group’s defining institution, using flexible scheduling, classroom extensions, distance education, and eventually online delivery. During the 1990s, Apollo Group became a publicly traded corporation. The company expanded as demand grew for career-oriented and flexible postsecondary education. University of Phoenix developed into a large North American provider with associate, bachelor’s, master’s, and doctoral programs, while Apollo assembled a broader portfolio. Western International University provided another adult-focused higher-education platform. Other acquisitions and investments extended into professional education, education publishing, online secondary education, coding boot camps, marketing services, and international schools. The international strategy included Apollo Global, created with The Carlyle Group in 2008. The venture pursued acquisitions outside the United States, including BPP Holdings in the United Kingdom, UNIACC in Chile, and other assets. Apollo’s portfolio also included Universidad Latinoamericana in Mexico and a majority interest in Open Colleges in Australia. Some businesses were later sold, renamed, closed, or transferred as the company adjusted its strategy. Apollo’s growth coincided with increasing debate over the for-profit college sector. In 2004, the U.S. Department of Education criticized University of Phoenix recruiting and admissions practices, and Apollo paid a fine. A related investor-disclosure lawsuit alleged that the company failed to disclose material information about the report. The case passed through several stages of trial and appeal and ultimately resulted in a reported $145 million liability. Other controversies included a 2008 settlement of a religious-discrimination class action involving University of Phoenix Online employees and a Federal Trade Commission investigation that led to litigation in 2016. The company’s financial and enrollment performance weakened during the early 2010s. Apollo reported declining revenue and operating income and attributed much of the pressure to lower enrollment. It sold or closed several businesses, including Insight Schools, Meritus University, and eventually Western International University. It acquired a majority interest in The Iron Yard in 2015, but that coding-boot-camp business later closed. Carnegie Learning and the College for Financial Planning were also subsequently sold. In 2016, shareholders approved the sale of Apollo Education Group to a consortium involving The Vistria Group, Apollo Global Management-affiliated funds, and the Najafi Companies. Completion in 2017 took the company private and ended its stock-market listing. Later public information about the group became more limited. The historical record therefore describes Apollo Education Group as a changing corporate portfolio rather than a single permanent operating institution. Its identity is distinct from that of the University of Phoenix, which was its most important subsidiary but not the corporate group itself.

1. 2019Western International University closes

   After a multi-year teach-out process, Western International University ceased operations.

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2. 2017Apollo becomes privately held

   The acquisition closed and the company was delisted.

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3. 2016Private acquisition approved

   Shareholders approved the sale of Apollo Education Group to a consortium of private investors.

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4. 2015The Iron Yard investment

   Apollo acquired a 62 percent interest in The Iron Yard, a U.S. provider of non-degree technology boot camps.

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5. 2011Meritus University closes

   Apollo’s Canadian institution announced closure because enrollment was insufficient to sustain its planned academic and student-support infrastructure.

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6. 2008Apollo Global joint venture formed

   Apollo Group and The Carlyle Group formed Apollo Global to pursue international education investments.

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7. 1994Public-company era begins

   Apollo Group entered its period as a publicly traded education company.

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8. 1976University of Phoenix established

   The University of Phoenix was established and later became Apollo’s principal and best-known education asset.

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9. 1973Apollo education company founded

   John Sperling and John D. Murphy founded the education company that later developed into Apollo Education Group.

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A flexible, career-oriented education platform historically focused on adult learners, working professionals, and other non-traditional students.

• University of PhoenixHigher-education institution1976

  The University of Phoenix was Apollo Education Group’s central and most recognizable institution. It focused on adult and working learners and offered associate, bachelor’s, master’s, and doctoral programs through a combination of physical locations, distance education, and online study. Its open-enrollment model generally relied on a high-school diploma, GED, or equivalent qualification, while prior-learning assessment could provide credit toward some programs. The university’s scale made it commercially important and also placed it at the center of debates about recruitment, student debt, educational outcomes, and regulation.

• Western International UniversityHigher-education institution1978

  Western International University was an adult-oriented institution offering business, technology, and other degree programs through online and classroom formats. It operated in Arizona and served a substantially smaller student population than the University of Phoenix. Apollo began a phased shutdown in 2017, allowing students to complete programs or transfer, and the institution officially ceased operations in 2019.

• BPP HoldingsProfessional and academic education

  BPP Holdings was a United Kingdom education group comprising BPP Learning Media, BPP Professional Education, and BPP University. Its activities covered professional qualifications, academic materials, and degree-level education through schools focused on business, law, health, foundation studies, and English-language learning. Apollo Global acquired the business in 2009 as part of its international education strategy.

• Carnegie LearningEducation technology and curriculum

  Carnegie Learning developed mathematics curricula combining textbooks with software-based tutoring, including the Cognitive Tutor platform. Its methods drew on research associated with Carnegie Mellon University and used adaptive or blended instruction for school, postsecondary, tutoring, and homeschool markets. Apollo announced an acquisition in 2011 and later sold the business.

• The Iron YardTechnology boot-camp education

  The Iron Yard provided intensive, non-degree information-technology and coding boot camps in the United States. Apollo acquired a majority interest in 2015 as part of an effort to participate in shorter-form workforce training. The subsidiary closed its campuses in 2017 and ended operations in early 2018.

• Open CollegesVocational and distance education

  Open Colleges was an Australian distance and vocational education provider in which Apollo acquired a 70 percent interest in 2013. It formed part of Apollo Global’s international portfolio and extended the group beyond U.S. higher education into flexible career and skills training.

• 2017Wind down Western International UniversityOther

  Apollo reviewed its portfolio amid weaker enrollment and the restructuring of its education assets.

  What changed. Western International University began a two-year teach-out and shutdown process.

  Aftermath. The institution officially closed in February 2019.

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• 2016Approve sale to private investorsM&A

  Declining enrollment, falling financial performance, regulatory scrutiny, and pressure on the publicly traded for-profit education sector shaped the decision to sell the company.

  What changed. Shareholders approved a transaction involving The Vistria Group, Apollo Global Management-affiliated funds, the Najafi Companies, and other investors.

  Aftermath. The deal closed in 2017, Apollo was delisted, and the group became privately held.

  Transaction value. $1.14 billion (Approved May 2016; completed 2017)

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• 2015Invest in The Iron YardStrategy

  Apollo pursued shorter, workforce-oriented education formats alongside its traditional degree businesses.

  What changed. Apollo acquired a 62 percent interest in The Iron Yard, a technology boot-camp provider.

  Aftermath. The Iron Yard later closed its campuses and ceased operations in early 2018.

  Acquisition consideration. $15.9 million (2015)

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• 2011Close Meritus UniversityOther

  Apollo concluded that enrollment would not support the academic and student-service infrastructure it considered necessary.

  What changed. Meritus University in Canada announced closure, with its final classes held in March 2011.

  Aftermath. Apollo exited that Canadian university operation.

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• 2008Create Apollo Global for international expansionStrategy

  Apollo sought to extend its education portfolio beyond the United States through acquisitions and investments in international markets.

  What changed. Apollo Group formed a joint venture with The Carlyle Group, with Apollo holding the majority interest. The venture was later renamed Vanta Education.

  Aftermath. The venture acquired or held education businesses in several countries, including BPP in the United Kingdom and institutions in Chile and other markets.

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• 2016Federal Trade Commission investigation and lawsuitControversy

  The FTC investigated and later sued Apollo and the University of Phoenix over alleged unfair business practices. The investigation sought records concerning marketing, tuition, billing, accreditation, and military-recruitment activities dating back to 2011.

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• 2008Religious-discrimination settlementControversy

  Apollo and University of Phoenix Online settled a class-action claim concerning alleged favoritism toward members of The Church of Jesus Christ of Latter-day Saints. The settlement reportedly involved approximately $1.89 million and did not include an admission of wrongdoing.

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• 2004Department of Education criticism of University of Phoenix recruitingControversy

  The U.S. Department of Education criticized admissions and recruitment practices at the University of Phoenix, including incentive structures tied to enrollment. Apollo paid approximately $10 million in fines. The episode became a major reputational and regulatory issue for the parent company.

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• 2019Western International University completes closure

  Western International University completed a phased teach-out and ceased operations.

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• 2017Apollo Education Group is delisted after acquisition

  The acquisition closed and Apollo Education Group became privately held, ending its public-company listing.

  M&A
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• 2017Apollo Education Group is delisted

  The company completed its transition to private ownership and was removed from the public markets.

  M&A
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• 2016Apollo Group announces sale to private-investor consortium

  Shareholders approved a proposed sale of Apollo Education Group for approximately $1.14 billion to investors including The Vistria Group, Apollo Global Management-affiliated funds, and the Najafi Companies.

  M&A
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• 2016Shareholders approve Apollo sale to private investors

  Shareholders approved a transaction valued at approximately $1.14 billion involving The Vistria Group, Apollo Global Management, and the Najafi Companies.

  M&A
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• 2015Apollo Education Group acquires The Iron Yard stake

  Apollo acquired a 62% interest in TIY Academy, the operator of The Iron Yard information-technology bootcamp network, for approximately $15.9 million.

  M&AProduct launch
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• 2011Apollo sells headquarters and leases it back

  The company sold its Arizona corporate headquarters and entered a long-term leaseback arrangement, raising approximately $170 million in cash.

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• 2008Apollo Group creates Apollo Global international education venture

  Apollo Group formed Apollo Global with The Carlyle Group to pursue international education acquisitions and investments.

  M&A
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• 2008Apollo Education Group forms Apollo Global with Carlyle

  Apollo Education Group and the Carlyle Group established Apollo Global to pursue international education acquisitions and investments.

  M&A
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1. Apollo Education Group
2. University of Phoenix