January 26, 2023
The University of Arkansas System confirmed this week that officials are in talks about potentially acquiring the University of Phoenix, making it the latest example of a public institution considering buying an online for-profit college to expand its reach.
A nonprofit entity affiliated with the system has been in discussions with University of Phoenix about potentially purchasing the institution and transforming it into an independent nonprofit, according to Nathan Hinkel, a system spokesperson. Under the structure being considered, there would be no ongoing relationship with the current owners of the university.
Hinkel said the system has been exploring ways to expand its online footprint and further its mission of providing an affordable education. The discussions follow the system’s move in 2021 to purchase Grantham University, then a for-profit, to build out its online operations.
“As the state’s leader in postsecondary education, we feel an obligation to consider any opportunity that has the potential to both improve educational attainment and secure new resources to support our campuses, divisions and units,” Hinkel said in an email.
A University of Phoenix spokesperson also confirmed the discussions. Neither the university nor the system said how much the potential acquisition would cost, but an anonymous source told the Arkansas Times, which first reported the news, that one estimate was between $500 million and $700 million.
The potential deal illuminates how much the for-profit sector has changed over the past decade as it’s dealt with a regulatory crackdown, sudden closures of several high-profile colleges and increasing competition from nonprofit colleges. The University of Phoenix has also faced numerous charges that it misled students.