XML 27 R12.htm IDEA: XBRL DOCUMENT
v3.21.1

Discontinued Operations and Assets Held for Sale | 3 Months Ended
--- | ---
Mar. 31, 2021
Discontinued Operations and Disposal Groups [Abstract] |
Discontinued Operations and Assets Held for Sale | Discontinued Operations and Assets Held for Sale As discussed in Note 1, Description of Business, the Company’s remaining principal markets are Mexico and Peru (the Continuing Operations). All remaining markets are being divested (the Discontinued Operations). In the tables below, certain classification changes have been made to the prior year amounts in order to conform to the current year presentation. On the Consolidated Statements of Operations, the results from the Discontinued Operations, which in the prior year were presented in two lines, have been combined into one line labeled Loss from discontinued operations, net of tax, for all periods presented. Summarized operating results and cash flows of the Discontinued Operations are presented in the following tables:
For the three months ended March 31, | 2021 |  | 2020
Revenues | $ | 239,750 |  |  | $ | 369,484 |
Depreciation and amortization expense | — |  |  | (24,511) |
Share-based compensation expense | (242) |  |  | (445) |
Other direct costs | (201,197) |  |  | (378,881) |
Loss on impairment of assets | (1,064) |  |  | — |
Other non-operating expense | (11,163) |  |  | (55,057) |
Loss on sale of discontinued operations before taxes, net | (16,837) |  |  | (23,553) |
Pretax income (loss) of discontinued operations | 9,247 |  |  | (112,963) |
Income tax (expense) benefit | (9,665) |  |  | 5,183 |
Loss from discontinued operations, net of tax | $ | (418) |  |  | $ | (107,780) |
Operating cash flows of discontinued operations | $ | 31,117 |  |  | $ | 47,381 |
Investing cash flows of discontinued operations | $ | (4,858) |  |  | $ | (14,158) |
Financing cash flows of discontinued operations | $ | (13,559) |  |  | $ | 20,797 |
Loss Recognized on Brazil Held-For-Sale Disposal Group During the first quarter of 2021, the Company recorded a loss of approximately $32,400 related to the Brazil disposal group, which was classified as a Discontinued Operation, in order to write down the carrying value of those assets to their estimated fair value less costs to sell as of March 31, 2021, in accordance with ASC 360-10, “Impairment and Disposal of Long-lived Assets” (ASC 360-10). The estimated fair value was based on the sale agreement for the disposal group that was announced on November 2, 2020, as discussed further below. The assets and liabilities of the Discontinued Operations, which are subject to finalization, have been classified as held for sale as of March 31, 2021 and December 31, 2020, in accordance with ASC 205. The assets and liabilities are recorded at the lower of their carrying values or their estimated fair values less costs to sell. The carrying amounts of the major classes of assets and liabilities that were classified as held for sale are presented in the following tables:
| March 31, 2021 |  | December 31, 2020
Assets of Discontinued Operations |  |  |
Cash and cash equivalents | $ | 272,108 |  |  | $ | 270,164 |
Receivables, net | 101,962 |  |  | 113,386 |
Property and equipment, net | 171,840 |  |  | 259,471 |
Goodwill and Tradenames | 1,163,536 |  |  | 1,202,496 |
Operating lease right-of-use assets, net | 101,572 |  |  | 136,806 |
Other assets | 217,545 |  |  | 183,742 |
Valuation allowance on held-for-sale disposal groups | (222,517) |  |  | (248,630) |
Total assets held for sale | $ | 1,806,046 |  |  | $ | 1,917,435 |
| March 31, 2021 |  | December 31, 2020
Liabilities of Discontinued Operations |  |  |
Deferred revenue and student deposits | $ | 116,489 |  |  | $ | 87,793 |
Operating leases, including current portion | 114,582 |  |  | 151,413 |
Long-term debt, seller notes and finance leases, including current portion | 116,646 |  |  | 171,451 |
Other liabilities | 265,993 |  |  | 291,599 |
Total liabilities held for sale | $ | 613,710 |  |  | $ | 702,256 |
Discontinued Operations with Signed Sale Agreements Pending Closure at March 31, 2021 Brazil Operations On November 2, 2020, the Company announced that it had entered into a definitive agreement with Ânima Holding S.A. (Anima) for the sale of its Brazilian operations. The transaction value is approximately 4,400,000 Brazilian Reals (approximately $765,000 at the time of signing), including 3,800,000 Brazilian Reals (approximately $660,700 at the time of signing) in cash consideration, which is subject to certain adjustments, and the assumption of net indebtedness. Under the agreement with Anima, the Company will be entitled to receive up to 203,000 Brazilian Reals (approximately $35,300 at the time of signing) in additional cash consideration if certain metrics are achieved following the closing. The transaction is targeted to close during the second quarter of 2021, subject to regulatory approval. Walden On September 11, 2020, Laureate entered into a Membership Interest Purchase Agreement (the Walden Sale Agreement) with Adtalem Global Education Inc., a Delaware corporation (the Walden Purchaser). Pursuant to the Walden Sale Agreement, the Company has agreed to sell to the Walden Purchaser all of the issued and outstanding equity interest in Walden e-Learning, LLC, a Delaware limited liability company and a wholly owned subsidiary of the Company and its subsidiary, Walden University, LLC, a Florida limited liability company and an indirect wholly owned subsidiary of the Company (together with Walden e-Learning, LLC, the Walden Group), in exchange for a purchase price of $1,480,000 in cash, subject to certain adjustments set forth in the Walden Sale Agreement. The closing of this transaction is expected to occur toward the end of 2021 and is subject to customary closing conditions, including regulatory approval by the U.S. Department of Education and the Higher Learning Commission and required antitrust approvals. Under certain specified circumstances, the Walden Purchaser may be required to pay the Company a termination fee of $88,000, including if the Walden Purchaser terminates the Walden Sale Agreement as a result of the imposition by the U.S. Department of Education of certain specified restrictions, or if Laureate terminates the Walden Sale Agreement as a result of the Walden Purchaser’s failure to consummate the transaction upon satisfaction of the closing conditions. Dispositions Honduras Divestiture On March 8, 2021, the Company completed the divestiture of its operations in Honduras to Fundación Nasser, a not-for-profit foundation in Honduras. In connection with the transaction, the Company transferred control of Fundaempresa, which manages Universidad Tecnológica Centroamericana (UNITEC), including Centro Universitario Tecnológico (CEUTEC), and received proceeds of approximately $26,000, net of cash sold and closing costs. Under the transaction terms, additional consideration of $2,000 was paid into an escrow account at closing and, assuming certain conditions are met, will be released to the Company based on the following schedule: 50% after 18 months, 25% after 24 months and 25% after 36 months. At closing, the Company recognized an after-tax gain of approximately $500, which is included in Loss from discontinued operations, net of tax in the Consolidated Statement of Operations for the three months ended March 31, 2021. Receipt of Remaining Escrow Receivable from Sale of China Operations On January 25, 2018, the Company completed the sale of LEI Lie Ying Limited in China. At the closing of the sale on January 25, 2018, a portion of the total transaction value was paid into an escrow account, to be distributed to the Company pursuant to the terms and conditions of the escrow agreement. In June 2020, the Company received approximately one-half of the escrow account, and the remainder was due in January 2021. In April 2021, the Company received 168,284 Hong Kong Dollars (approximately $21,650 at the date of receipt), which represented payment in full for the remainder of the escrow account. Accordingly, the Company recognized a gain of approximately $13,600, which is included in Loss from discontinued operations, net of tax in the Consolidated Statement of Operations for the three months ended March 31, 2021.

X
- References No definition available. + Details
Name: | us-gaap_DiscontinuedOperationsAndDisposalGroupsAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure related to a disposal group. Includes, but is not limited to, a discontinued operation, disposal classified as held-for-sale or disposed of by means other than sale or disposal of an individually significant component. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 360 -URI http://asc.fasb.org/topic&trid=2155823 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -URI http://asc.fasb.org/subtopic&trid=2122178 + Details
Name: | us-gaap_DisposalGroupsIncludingDiscontinuedOperationsDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration