The future of learning is here with Instructure Holdings, Inc. (NYSE: INST) signing an acquisition deal with Parchment. Instructure adds one of the world’s largest academic credentialing platforms and networks to its Learning Platform, significantly expanding its customer base.
Parchment has 15,000 customers and has exchanged over 165 million credentials in two decades. The acquisition is estimated to unlock a new $2 billion Total Addressable Market (TAM) across multiple high-growth categories. All of this is made possible by Parchment’s comprehensive academic credential management platform and network, which helps learners, educational institutions, and employers request, verify, and share transcripts, diplomas, and other credentials.
Instructure CEO Steve Daly commented on the deal: “This acquisition represents an important next step for Instructure to serve all learners, beginning in K-12 and continuing throughout their lifelong learning journey. By adding Parchment to the Instructure Learning Platform, we will provide a verifiable and comprehensive digital passport of achievement records and outcomes for learners. Together, we expand the Instructure platform for existing customers, welcome new Parchment customers and open new pathways for growth with multiple new solution categories.”
The acquisition of Parchment by Instructure is estimated to be worth $835 million. The net purchase price, including a tax benefit from the trade is approximately $795 million, or about 16 times Parchment’s expected 2024 Adjusted EBITDA inclusive of anticipated run-rate cost synergies.
Instructure is looking to benefit from Parchment’s highly stable and recurring revenue, with gross solid retention metrics in the mid-to-high 90s. It plans to finance the transaction with cash and incremental debt under its existing credit facility.
This move is a huge win for teachers. Instructure and Parchment are both committed to amplifying the power of teaching and learning. Together, they will provide a seamless experience for learners, helping them to access educational and employment opportunities. The combined platform will also provide solutions that connect learners, institutions, and employers across a learner’s journey – from the first search for a course or programme to employment.
Instructure, set up in 2008 by two enterprising graduate students, is the parent company of Canvas LMS and the Instructure Learning Platform, which benefits millions of students and teachers worldwide every day. The company focuses on openness, relationships, equality, ownership, and simplicity to help everyone learn together.
Teachers around the world are now able to look forward to more accessible, equitable access to educational and employment opportunities for their students. Thanks to this acquisition, the future of learning looks even brighter.
