Adtalem Confirms Talks With YDUQS Over Brazil Operations Sale
Zacks Investment Research | Oct 16, 2019 10:47PM ET
Adtalem Global Education Inc. (NYSE:ATGE) confirmed active negotiations with the Brazilian for-profit education company YDUQS — formerly known as Estacio Participacoes SA — for potential sale of its operations in Brazil.
Adtalem’s Brazilian operation, Adtalem Educacional do Brasil, operates under the Business and Law segment.
While the company stated that there is no assurance of a binding agreement, YDUQS is confident about the deal.
Reasons for Sale
The company has been facing challenges in Brazil over the past few quarters, which have been marring the top line. Revenues in the Business and Law segment, which comprises solely Adtalem Brazil, contributed 18.2% to total revenues in fiscal 2019. However, Adtalem Brazil’s revenues fell 16.6% in fiscal 2019. The downside was caused by drop in Brazilian Real’s value compared with the U.S. dollar. On a constant-currency basis, revenues fell 3.1% in fiscal 2019.
Intense competition along with higher discounts to offset reductions in government financial aid funding led to the decline.
Lower enrollment growth and pricing pressure in the education sector stemming from challenging economic conditions in Brazil have been concerns for Adtalem.
Other Factors Affecting Growth
Shares of Adtalem have declined 22.8% so far this year against the Original post
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.