Here's a kind of business transaction that you don't usually hear about: the sale of a Massachusetts edtech company called Curriculum Associates could result in a $28 million donation to The Boston Foundation.
Sacha Pfeiffer of The Boston Globe (and "Spotlight" fame) has the story today about how Curriculum Associates transferred a majority of its stock to the Iowa State University Foundation. The foundation is a nonprofit at Iowa State, where Curriculum Associates co-founder Frank Ferguson went to school.
So how does that translate into tens of millions of dollars for one of Boston's largest charities? Once the university sells its nonvoting shares in Curriculum Associates within the next five years, a portion of the sale's proceeds will go to the Boston Foundation — estimated to be worth $28 million by the edtech company.
This comes with the caveat that the value of Curriculum Associates' shares could go up or down over the next few years, with the total value of the gift to be determined at the time of sale. However, as it stands right now, it's set to be the second-largest gift ever received by The Boston Foundation, which celebrated its 100-year anniversary in 2015.
Curriculum Associates makes digital and print instructional materials for K-8 education. The company has 668 employees and $190 million in annual sales, the latter number landing it on the 2016 Inc. 5000 list of the fastest growing privately held companies in the US. Similar to Cengage Learning, the company was originally founded in 1969 making educational materials and has evolved into an edtech company over time. CEO Rob Waldron will continue to lead the company and will take part in its eventual sale.
“To drive social change, we need to support the nonprofit sector,” Waldron told the Globe, “and you need great community foundations like The Boston Foundation to support these organizations.”
Laura Kenney, a local tax expert, told the Globe that Curriculum Associates' donation of shares could come with several tax benefits, including having to pay less in capital gains taxes at the time of the company's sale.
