Strategic Education, Inc. Announces Pricing of Upsized Public Offering of Common Stock

HERNDON, Va.–(BUSINESS WIRE)–Strategic Education, Inc. (Strategic Education) (NASDAQ: STRA) announced today the pricing of an upsized underwritten registered public offering of 1,900,000 shares of its common stock at a public offering price of $105.00 per share. Strategic Education has granted the underwriters an option for 30 days to purchase up to an additional 285,000 shares of its common stock sold at the public offering price, less the underwriting discount. The offering is expected to close on or about August 10, 2020, subject to satisfaction of customary closing conditions.

The net proceeds from the offering will be approximately $191.5 million (or $220.2 million if the underwriters exercise their option to purchase additional shares as described above) after giving effect to the underwriting discounts but before giving effect to any offering expenses payable by Strategic Education. Strategic Education intends to use a portion of the net proceeds of the offering to fund, in part, the cost of the proposed acquisition of Laureate Education, Inc.’s Australia and New Zealand operations, and the remainder for general corporate purposes, which could include future acquisitions, capital expenditures and working capital. The closing of the offering is not conditioned upon the consummation of the proposed acquisition. If the proposed acquisition is not consummated, Strategic Education intends to use the net proceeds of the offering for general corporate purposes, which could include other acquisitions.

BofA Securities and Truist Securities are acting as joint lead book-running managers. BMO Capital Markets and PNC Capital Markets LLC are acting as book-running managers, and TD Securities, BNP PARIBAS and Ramirez & Co., Inc. are acting as co-managers for the offering.

The offering is being made pursuant to an effective shelf registration statement on Form S-3 (Reg. No. 333-241005), including a base prospectus and prospectus supplement filed by Strategic Education with the Securities and Exchange Commission (SEC). You may obtain these documents for free when they are available by visiting the SEC website at www.sec.gov. When available, a copy of the final prospectus supplement and the accompanying base prospectus relating to the offering may be obtained from BofA Securities, NC1-004-03-43, 200 North College Street, 3rd Floor, Charlotte, North Carolina 28255-0001, Attn: Prospectus Department, or by emailing: dg.prospectus_requests@bofa.com; or from Truist Securities, 3333 Peachtree Road NE, 9th floor, Atlanta, Georgia 30326, Attention: Prospectus Department, email: truistsecurities.prospectus@truist.com.

This press release does not constitute an offer to sell or the solicitation of an offer to buy Strategic Education’s common stock nor shall there be any sale of such common stock in any state or jurisdiction in which such offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

Forward-Looking Statements

This communication contains certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements may be identified by the use of words such as “expect,” “estimate,” “assume,” “believe,” “anticipate,” “may,” “will,” “forecast,” “outlook,” “plan,” “project,” “potential” and other similar words, and include all statements that are not historical facts, including with respect to, among other things, the expected timing, size, terms and Strategic Education’s ability to complete the offering; Strategic Education’s anticipated use of proceeds from the offering; and the completion of the proposed acquisition of Laureate Education, Inc.’s Australia and New Zealand operations and the timing thereof. The statements are based on Strategic Education’s current expectations and are subject to a number of assumptions, uncertainties and risks, including but not limited to:

the pace of student enrollment;
Strategic Education’s continued compliance with Title IV of the Higher Education Act of 1965, as amended, and the regulations thereunder, as well as other federal laws and regulations, regional accreditation standards, and state regulatory requirements;
rulemaking by the U.S. Department of Education and increased focus by the current or future U.S. Congresses or Administrations on for-profit education institutions;
competitive factors;
risks associated with the further spread of COVID-19, including the ultimate effect of COVID-19 on people and economies;
risks associated with the opening of new campuses;
risks associated with the offering of new educational programs and adapting to other changes;
risks associated with the acquisition of existing educational institutions, including in the case of the proposed acquisition of Laureate Education, Inc.’s Australia and New Zealand operations, the risk that the acquisition may not be completed in a timely manner or at all, the risk that the benefits of the acquisition may not be fully realized or may take longer to realize than expected, and the risk that the acquisition may not advance Strategic Education’s business strategy and growth strategy;
risks related to the timing of regulatory approvals;
Strategic Education’s ability to continue to implement its growth strategy;
the amount of the costs, fees, expenses, and charges related to Strategic Education’s merger with Capella;
the risk that the merger with Capella may not advance Strategic Education’s business strategy and growth strategy;
the risk that Strategic Education may experience difficulty integrating Strayer’s and Capella’s employees or operations;
the potential diversion of our management’s attention resulting from the merger with Capella;
risks associated with the ability of students to finance their education in a timely manner;
general economic and market conditions; and
additional factors described in Strategic Education’s most recent Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.

Many of these risks, uncertainties and assumptions are beyond Strategic Education’s ability to control or predict. Because of these risks, uncertainties and assumptions, you should not place undue reliance on these forward-looking statements. Furthermore, these forward-looking statements speak only as of the information currently available to Strategic Education on the date they are made, and Strategic Education undertakes no obligation to update or revise forward-looking statements, except as required by law. Actual results may differ materially from those projected in the forward-looking statements.