Edtech firm 2U files for bankruptcy
The online education provider 2U last week announced it’s filed for bankruptcy and is restructuring its debt, steps that will allow it to “continue investing in our offerings, services, and world-class team to deliver unparalleled online learning to meet the needs of students today.”
In a press release last Thursday the company announced its plans to restructure its finances, with lenders and noteholders holding a majority of the company’s outstanding debt, providing $110 million in new capital. The company’s outstanding debt, will thus be reduced to $459 million. Chapter 11 bankruptcy will provide another $64 million, according to the release.
2U in 2021 announced it was buying the online course nonprofit EdX from Harvard University and the Massachusetts Institute of Technology for $800 million. At the time 2U bragged it would leverage the purchase into an organization that can “reimagine education in ways that transform the lives of global citizens and positively impact generations to come.”
Paul Lalljie, last week called the bankruptcy filing “an important milestone.”
“New capital and a healthier balance sheet will enable us to continue our long-standing mission,” he said. “For over 15 years, 2U has led the online learning industry in the delivery of innovative, high-impact education in partnership with an unmatched network of leading universities. The steps we are taking today will enable us to continue investing in our offerings, services, and world-class team to deliver unparalleled online learning to meet the needs of students today. As we move towards the successful completion of this transaction, we are steadfastly focused on what matters most: our partners and learners.”
Between December 2022 and last April, the company has laid off approximately 1,000 employees, or 29% of its staff, the Baltimore Banner reported.
