Nonprofit ETS to Acquire For-Profit Questar Assessment for $127.5 Million
Educational Testing Service (ETS) has signed a definitive agreement to acquire Questar Assessment Inc., a K–12 assessment solutions provider, for $127.5 million. Subject to regulatory approval and customary closing conditions, Questar will become a separate, for-profit subsidiary of ETS, a nonprofit organization.
The acquisition would allow both organizations to gain capacity, improve capability and acquire additional operating resources to better serve clients in the K–12 marketplace, according to a news release. Current clients of both companies will continue to be served as before.
Questar supplies states with summative assessments for grades 3 to 8, end-of-course tests and alternative assessments for students with disabilities. Questar is widely known for its fresh approach to assessment, technical innovations that set the standard for scalability and reliable online testing performance, and for reimagining how assessments can empower educators and better serve students. Nextera, Questar’s end-to-end assessment platform, integrates content management, student-test interface, administration and image-based hand-scoring capabilities.
ETS designs and administers more than 50 million tests per year in 180 countries. Its assessments include the GRE, TOEFL, TOEIC, the Department of Education’s National Assessment of Educational Progress (NAEP, also known as “the Nation’s Report Card”), and the College Board’s SAT and Advanced Placement tests. In the K–12 marketplace, ETS administers state contracts, including the State of Texas Assessments of Academic Readiness (STAAR), and the California Assessment of Student Performance and Progress (CAASPP), as well as other state testing programs.
“ETS and Questar are already proven players in serving states, districts, educators and students across the nation,” said ETS President Walt MacDonald in a prepared statement. “This deepens our commitment, especially since both our missions of serving education, improving instruction and fully preparing students for college and careers are so closely aligned.”
The $127.5 million is subject to certain adjustments as set forth in the transaction agreement. Holders of Questar common stock are expected to receive approximately $2.80 per share in the transaction.
Barclay’s is acting as exclusive financial advisor and Jones Day as legal advisor to ETS. BMO Capital Markets is acting as exclusive financial advisor and Vedder Price as legal advisor to Questar.
ETS is based in Princeton, NJ, and Questar is based in Minneapolis, MN.