HMHC - Veritas Capital to Acquire Houghton Mifflin Harcourt

Investment Firm Veritas Capital has reported entry into a definitive merger agreement with Houghton Mifflin Harcourt Company (NASDAQ: HMHC) to acquire Houghton Mifflin Harcourt Company.  HMH shareholders are entitled to receive USD 21 per share through a tender offer.  This per share purchase price represents a 36% premium to the Company’s share price as of January 13th, 2022 and an implied equity value of USD 2.8 Billion.  “Partnering with Veritas will provide HMH with the opportunity to accelerate our momentum and increase our impact on the four million teachers and 50 million students that we support each day. With accelerating billings growth, strong free cash flow and a transformed cost structure, we are at an important inflection point, and the time is right to move into the next phase of our long-term growth strategy alongside a partner that brings significant industry expertise,” said Jack Lynch, President and Chief Executive Officer of HMH, who will continue to lead the Company along with the current management team. “As the promise of digital learning increasingly takes hold across the nation, we are confident this transaction will deepen our ability to bring the power of learning to even more teachers and their students, invest in our purpose-driven team, and have a positive impact on the communities we serve.”

“We recognize HMH as one of the storied brands in education and are excited to partner with the company to expand its market-leading digital solutions and deliver the most efficacious products to students and teachers,” said Ramzi Musallam, Chief Executive Officer and Managing Partner of Veritas. “Over Veritas’ two decades of investing, education and technology have both become critical areas of focus across our portfolio. We look forward to bringing to bear our deep experience in K-12 education and proven track record to meaningfully invest in the Company to help drive better outcomes for students across the nation.”

This agreement was unanimously approved by HMH’s board of directors.  The transaction is expected to close in the second quarter of 2022, subject to certain regulatory approvals and customary closing conditions.

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