Private Equity Firm Hellman & Friedman Acquires Learning Analytics Company Renaissance Learning For $1.1B In Cash

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Learning analytics service Renaissance Learning today announced that it has been acquired by private equity firm Hellman & Friedman for $1.1 billion in an all-cash deal. The new deal comes just a few weeks after Renaissance closed a $40 million funding round led by Google Capital at a valuation of $1 billion. That deal made Google Capital a minority owner of the company.

Renaissance Learning  was founded back in 1985 by Judith and Terrance Paul, who remained the company’s majority owners for the longest time. The company went public in 1996 but always remained closely held. It was taken back private in 2011 after it was acquired by the British private equity firm Permira for $455 million, which remained its majority owner until now.

“Renaissance Learning is an outstanding company that has been helping educators accelerate student learning for decades,” said Tarim Wasim, Managing Director at Hellman & Friedman in a statement today. “We believe strongly in the mission and are excited to help grow Renaissance’s impact globally through continued investment in products that make a difference in the classroom.”

Renaissance is currently in use in about 30 percent of U.S. schools. The company offers tools for teachers to track student success over time. At its core, it’s a data-driven company that offers a wide variety of desktop- and web-based learning and assessment tools. Its first product in the 1980s was an application for teaching reading skills and while that remains a core product, the company quickly branched out into other subjects, as well.

As Renaissance CEO Jack Lynch told me, Hellman & Friedman first showed interest in the company late last year and the negotiations become serious over the last few months.

Google Capital was aware of the possibility of the acquisition when the funding round closed and is expected to remain an investor in the company, though the details of that agreement haven’t been settled yet.

Hellman & Friedman, Lynch noted, previously acquired the likes of DoubleClick (which later went to Google) and Nielsen. The firm, he argued, is mostly interested in working with firms that have shown rapid growth and “exceptional businesses in terms of competitive advantages.” Renaissance fit that bill pretty well, with 21 percent top-line growth over the last year and a strong presence in the education space.

Looking ahead, Lynch doesn’t expect the sale to affect the company’s product roadmap. Under Permira, Renaissance already allocated additional funds for its R&D efforts and it expects this will continue. For the time being, Renaissance also doesn’t expect any changes in the executive team. Hellman & Friedman will likely get two board seats.