The Washington Post Co. yesterday announced an agreement in principle to acquire Stanley H. Kaplan Educational Centers, a family-owned business that prepares students for a broad range of college admissions tests and licensing examinations.
Financial details of the transaction were not disclosed.
The New York-based company, founded in 1938, will operate as a Post Co. subsidiary, and management will remain in place, including Kaplan, who said yesterday that he agreed to stay on for 10 years. With about $35 million in revenue, 120 permanent educational centers throughout the United States and 95,000 students, the Kaplan operation is the largest in the industry.
"I believe this is an excellent business that has been run with the greatest attention to quality and that has substantial growth prospects," said Richard D. Simmons, president of The Washington Post Co.
"This is the meeting of the minds of two organizations that have a dedication to excellence," said Kaplan, who has been approached on numerous occasions over the years by other potential acquirers. " . . . We believe this acquisition will ensure our centers' tradition of excellence and will contribute to our plans for further growth and service."
In addition to preparing students for the entrance examinations for undergraduate and graduate schools, including the Scholastic Aptitude Test (SAT) and the Law School Admissions Test (LSAT), the Kaplan organization recently began offering speed-reading courses and, in selected test markets, is offering professional licensing courses in law and accounting.
Kaplan and Simmons said yesterday they believe the business has tremendous growth potential overseas, especially in Japan, Western Europe and the Middle East, offering courses to foreign students interested in attending undergraduate and graduate schools in the United States. Simmons said The Washington Post Co.'s presence overseas through Newsweek International will assist in this expansion.
Simmons said growth also can be achieved through marketing the course more effectively to high school students preparing for the SAT, because only a small percentage of the approximately 1 million students who took the SAT last year were Kaplan students.
Simmons said he is intrigued by the possibility of expanding the operation to offer remedial courses on an ongoing basis to students, and by using computers as teaching devices. He said The Post Co. can offer the Kaplan organization assistance in marketing and data processing.
Kaplan said he started the business in 1938 because of his love for teaching. Kaplan and Simmons said they believe the business will benefit from the increasing desire of many students to attend prestigious universities.
They said they expect to sign a definitive agreement before the end of the year.