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Learning Tree International Inc. (Nasdaq: LTRE), which provides information technology and management training, was a fast grower from 1974 to 2000. However, since then, things have languished. True, the company has instituted various initiatives to jump-start growth, but such measures will take some time.
So, in the meantime, Learning Tree is trying to sell out. That is, the company has formed a special committee to explore the possibility of selling itself and has retained RBC Capital Markets as a financial advisor.
Learning Tree is likely to be attractive to private equity players as well as strategic buyers. Over the past few years, the company has improved its operating performance, earned 50% of sales from overseas and has $56 million in the bank, without debt. What's more, the company has no school loan exposure.
Even so, growth is still elusive. For example, Q1 revenues inched up 4% to $39.2 million. But the company is putting more resources into curricula development and sales and marketing.
It also looks like the co-founders of Learning Tree, David Collins and Eric R. Garen, are looking for liquidity. They own 25% and 20% of the company's shares, respectively.
As for today's trading so far, Learning Tree's share price is up 9% to $17.96.
Tom Taulli is the author of various books, including The Complete M&A Handbook
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