Stonington Partners plans to exit its 17.6% stake in for-profit education company Lincoln Educational Services, selling the 3.9 million shares it holds in the company, Reuters reported. West Orange, New Jersey-based Lincoln said it would not be receiving any proceeds from the sale, Reuters said.
(Reuters) – Lincoln Educational Services Corp said its largest shareholder, Stonington Partners, plans to sell the remaining 3.9 million shares it holds in the company.
The private equity firm holds about 17.6 percent in the company, according a filing dated Nov. 5.
The West Orange, New Jersey-based company on Thursday said it would not be receiving any proceeds from the sale.
“While this pending sale could cause some near-term pressure on the stock, it should improve the float of the company’s shares,” BMO Capital analyst Jeff Silber said.
Separately, the company said its Executive Chairman, David Carney, will retire effective Dec. 31. It said Alexis Michas, a board member of the company, will be appointed as non-executive chairman.
For-profit education companies, including Lincoln have have been criticized by the Obama administration for saddling students with big debts and not fully preparing them for jobs.
The company’s shares closed at $16.41 on Thursday on Nasdaq. They have gained 33 percent since Nov.2 when Licoln reported strong third-quarter results, while the education sub-index has fallen about 2 percent in the same period.
(Reporting by Megha Mandavia in Bangalore)