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Strayer Education, Inc.

Strayer Education, Inc.

Strayer Education, Inc. (NASD: STRA) is an education services holding company which owns Strayer University. Strayer’s mission is to make higher education achievable and convenient for working adults in today’s economy.

Founded in 1892, Strayer University is a proprietary institution of higher learning accredited by the Middle States Commission on Higher Education. Strayer University offers undergraduate and graduate degree programs in business administration, accounting, information technology, education, and public administration. It serves more than 23,000 working adult students at 32 campuses in eight states in the eastern United States and worldwide via the Internet through Strayer University Online. Strayer University is committed to providing an education that prepares working adult students for advancement in their careers and professional lives.

New Mountain proactively identified the post-secondary education sector as an area of industry focus beginning in early 2000. The Firm built a database of 4,000 properties in the space, hired executives from the industry to be in residence at the Firm and targeted approximately thirty companies to proactively pursue. During this process of top down industry analysis, the Firm became aware of the opportunity to invest in Strayer. In May 2001, New Mountain led a $150 million investment to acquire control of Strayer, and negotiated this transaction on an exclusive basis, without an auction.

Strayer’s valuation and growth rate had been held back due to the illness of its then-CEO and the absence of management successors. Following the investment, two of New Mountain’s executives-in-residence were appointed as the CEO and COO of Strayer, and New Mountain’s CEO was elected as Strayer’s non-executive chairman. In addition, the Company adopted a new five-part growth strategy written for the company by New Mountain during its period of due diligence. As a result of these efforts and strategy, Strayer has grown from 12,000 students to 23,000, from 14 campuses to 32, from the Washington D.C. / Richmond area only into eight states, from a 12% growth rate in revenues to a 25% rate (without acquisitions), from a small on-line program to a substantial one and from a thin management team to a much stronger team. The company has achieved record revenues, earnings and enrollment each quarter of New Mountain’s ownership. Strayer’s market value has increased from approximately $400 million to approximately $1.5 billion, between the time New Mountain announced its intention to invest in November 2000 and year end 2004. The company has been debt free the entire time, and now has more then $120 million of cash and equivalents on hand, as of year end 2004. New Mountain sold its final shares of Strayer in August, 2005