Tuesday, April 17, 2007

Student Loans: $25 Billion

By Bryan O'Keefe

In some non-scandalous student loan news, we see yesterday that the loan giant Sallie Mae is being bought out and will go private sometime in the near future (private in this sense means no longer being a public company; Sallie Mae already went private in another sense about ten years ago when it decided that it would no longer be controlled by the government). There are lots of interesting questions that this deal brings up, which I unfortunately do not have time to talk about now. Rich will be discussing some of these issues in the next couple of days. But for now, just consider this: the consortium of private equity firms/investment banks that are taking over Sallie Mae, are going to pay $25 billon dollars for the company -- that's truly a magnificent sum of money for a student loan company and gives you some indication as to how incredibly vast our student loan industry really is.

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