Capstone Partners LLC, a leading investment banking firm, announced that it has successfully advised NTT, Inc. in its acquisition by ECPI University.
NTT Workforce Development Institute, based in Centennial, Colorado, provides electrical, mechanical and “shop floor” safety training to leading manufacturing companies such as Chevron, Boeing, American Airlines, etc. Just over two years ago, it was spun out of UTI, a large publicly traded provider of automotive degree training because it did not fit in with its core business and was purchased by two entrepreneurs with limited operational expertise in the market. They retained existing Management but began to change the business model from public seminars to private company recurring business. Over the last two years, they performed a rather remarkable turnaround and were looking to capitalize on the upswing in performance. Conventional thought would have been that a competitor in the corporate training space such as GP Strategies would be the most likely acquirer. However, given Capstone’s experience in post-secondary education, we knew that for-profit post-secondary education companies were struggling mightily with their 90/10 ratios.
Knowing that the revenues of NTT would qualify as “10” money, Capstone determined that many of the PSE related companies would most likely overpay to fix a flaw in their fundamental business models. A total of 210 potential buyers were approached which ranged from traditional private equity buyers, post-secondary education providers, corporate training providers and large manufacturing companies that may have sought to bring this training in-house. In the end we received 12 offers from each member of the groups above with the majority of companies in the PSE space, so we were able to make sure that the entire universe was covered. As expected, when the dust settled, the winning bidder was a private held post-secondary education university based in Virginia called ECPI University and our transaction logic was substantiated.