As discussed in Note 1, Description of Business, on August 9, 2018, the Company announced that it planned to focus on its principal markets and would divest certain of its other markets. The principal markets that will remain (the Continuing Operations) include Brazil, Chile, Mexico, and Peru, along with the Online & Partnerships segment and the institutions in Australia and New Zealand. At the time of the announcement on August 9, 2018, the markets being divested by sale (the Discontinued Operations) included the institutions in Portugal and Spain, which were part of the Andean segment, all remaining institutions in the Central America & U.S. Campuses segment, and all remaining institutions in the Rest of World segment, except for Australia, New Zealand and the managed institutions in the Kingdom of Saudi Arabia and China. The institutions in the Kingdom of Saudi Arabia were managed under a contract that expired at the end of August 2019 and was not renewed. Accordingly, these institutions were disposed of other than by sale on August 31, 2019 and, beginning in the third quarter of 2019, have been included in Discontinued Operations for all periods presented. As of September 30, 2019, one VIE institution in Honduras is included in the Discontinued Operations.

The divestitures are expected to create a more focused and simplified business model and generate proceeds that have been and will be used for further repayment of long-term debt. The timing and ability to complete any of these transactions is uncertain and will be subject to market and other conditions, which may include regulatory approvals and consents of third parties.



For the three months ended September 30,	2019			2018
Revenues	$	65,316		$	160,278
Depreciation and amortization	339			6,991
Share-based compensation expense	119			173
Loss on impairment of assets	25,000			—
Other direct costs	64,681			188,284
Operating loss	(24,823		)	(35,170		)
Other non-operating expense	(252		)	(5,674		)
Pretax loss of discontinued operations	(25,075		)	(40,844		)
Income tax (expense) benefit	(2,062		)	2,939
Loss from discontinued operations, net of tax	$	(27,137	)	$	(37,905	)


For the nine months ended September 30,	2019			2018
Revenues	$	446,002		$	673,975
Depreciation and amortization	1,176			28,776
Share-based compensation expense	387			920
Loss on impairment of assets	25,000			—
Other direct costs	343,317			561,528
Operating income	76,122			82,751
Other non-operating income (loss)	6,276			(18,794		)
Pretax income of discontinued operations	82,398			63,957
Income tax expense	(15,926		)	(40,406		)
Income from discontinued operations, net of tax	$	66,472		$	23,551

Operating cash flows of discontinued operations	$	45,237		$	155,367
Investing cash flows of discontinued operations	$	(16,007	)	$	(40,043	)
Financing cash flows of discontinued operations	$	(44,984	)	$	(17,306	)

The assets and liabilities of the Discontinued Operations, which are subject to finalization, have been classified as held for sale as of September 30, 2019 and December 31, 2018, 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.’ In addition to the Discontinued Operations, Centro Universitário do Norte (UniNorte), a traditional higher education institution located in the city of Manaus, Brazil, has also been classified as held for sale as of September 30, 2019 and December 31, 2018. UniNorte is included in Continuing Operations as it is not part of the strategic shift described above. As described below, on April 16, 2019, the Company entered into an agreement to divest UniNorte and the sale of UniNorte closed on November 1, 2019. See Note 21, Subsequent Events.



	September 30, 2019		December 31, 2018
Assets of Discontinued Operations
Cash and cash equivalents	$	62,194	$	215,644
Receivables, net	42,277		62,576
Property and equipment, net	259,884		671,121
Goodwill	9,613		131,329
Tradenames	6,893		124,932
Operating lease right-of-use assets, net	66,673		—
Other assets	61,056		106,326
Subtotal: assets of Discontinued Operations	$	508,590	$	1,311,928

Other assets classified as held for sale: UniNorte Brazil
Receivables, net	$	6,969	$	6,983
Property and equipment, net	13,193		16,726
Goodwill	14,083		15,165
Tradenames	7,565		8,146
Operating lease right-of-use assets, net	15,244		—
Other assets	6,161		13,935

Other land and buildings classified as held for sale
Property and equipment, net	8,374		—
Subtotal: other assets classified as held for sale	$	71,589	$	60,955

Total assets held for sale	$	580,179	$	1,372,883



	September 30, 2019		December 31, 2018
Liabilities of Discontinued Operations
Deferred revenue and student deposits	$	53,885	$	115,969
Operating leases, including current portion	71,411		—
Long-term debt and finance leases, including current portion	56,054		279,612
Other liabilities	91,094		269,558
Subtotal: liabilities of Discontinued Operations	$	272,444	$	665,139

Other liabilities classified as held for sale: UniNorte Brazil
Deferred revenue and student deposits	$	1,768	$	469
Operating leases, including current portion	10,119		—
Long-term debt and finance leases, including current portion	2,250		5,370
Other liabilities	8,554		9,405
Subtotal: other liabilities classified as held for sale	$	22,691	$	15,244

Total liabilities held for sale	$	295,135	$	680,383

On April 16, 2019, Rede Internacional de Universidades Laureate Ltda., a limited business company organized under the laws of Brazil (the UniNorte Seller), which is an indirect wholly owned subsidiary of the Company, entered into a Quota Assignment and Transfer Agreement (the UniNorte Agreement) with Cenesup - Centro Nacional de Ensino Superior Ltda., a limited liability company organized under the laws of Brazil (the UniNorte Purchaser), which is an indirect wholly owned subsidiary of Ser Educacional S.A., a company organized under the laws of Brazil (Ser). Pursuant to the UniNorte Agreement, the UniNorte Purchaser will purchase from the UniNorte Seller 100% of the quota capital of Sodecam - Sociedade de Desenvolvimento Cultural do Amazonas Ltda., a limited liability company organized under the laws of Brazil, which is the maintaining entity of UniNorte. The Company and Ser are also parties to the Agreement as guarantors of certain obligations of their respective subsidiaries.

The transaction enterprise value under the UniNorte Agreement is 194,800 Brazilian Reais (BRL) (or approximately $46,600 as of September 30, 2019), which includes the assumption of net debt in the amount of approximately BRL 9,800 (or approximately $2,300 as of September 30, 2019). The transaction closed on November 1, 2019, following the completion of customary closing conditions, including approval by the Brazilian competition authorities.

On June 14, 2019, the Company and Exeter Street Holdings, LLC, an indirect wholly owned subsidiary of the Company, entered into a membership interests purchase agreement with Ambow NSAD, Inc. and Ambow Education Holding, Ltd. (the NSAD Buyers) to sell 100% of the outstanding membership interests of NSAD to the NSAD Buyers for a purchase price of one dollar, subject to certain adjustments. In addition, under the terms of the agreement, the Company estimates that it will pay subsidies to the NSAD Buyers for continued operations and campus facilities of up to approximately $5,800. The closing of the sale is subject to regulatory approvals and other conditions precedent, which could take approximately six months from the date of the purchase agreement. NSAD is a higher education institution located in California that offers undergraduate and graduate degrees and non-degree certificates in design and construction management.

As previously reported, on December 11, 2017, Exeter Street Holdings Sdn. Bhd., a Malaysia corporation (Exeter Street), and Laureate Education Asia Limited, a Hong Kong corporation (Laureate Asia), both of which are indirect wholly owned subsidiaries of the Company, entered into a sale purchase agreement (as amended on January 17, 2019, the Inti Agreement) with Comprehensive Education Pte. Ltd., a Singapore corporation (Comprehensive, the purchaser) that is an affiliate of Affinity Equity Partners, a private equity firm based in Hong Kong. Pursuant to the Inti Agreement, Comprehensive agreed to purchase from Exeter Street

The closing of the transaction under the Inti Agreement was subject to certain conditions, including approval by regulators in Malaysia, which approval was obtained on June 24, 2019. On June 25, 2019, the Company notified Comprehensive that the conditions precedent had been duly satisfied and scheduled closing for July 12, 2019. On July 9, 2019, Comprehensive notified the Company that it disagreed with the Company’s position that the conditions precedent had been satisfied and formally moved to terminate the Inti Agreement, an act viewed by the Company as a repudiatory breach of the Inti Agreement. The Company is currently evaluating all options and continues to classify Inti Holdings as a discontinued operation.

As previously disclosed in our 2018 Form 10-K, the sale of St. Augustine was completed on February 1, 2019. The total transaction value under the sale agreement was $400,000. Upon completion of the sale, the Company received net proceeds of approximately $346,400, which included $11,700 of customary closing adjustments, and was net of $58,100 of debt assumed by the purchaser and fees of $7,200. The proceeds net of cash sold were approximately $301,800, which the Company used to repay outstanding indebtedness under its U.S. term loan and revolving credit facility. The Company recognized a gain on the sale of approximately $223,000, which is included in gain on sales of discontinued operations on the consolidated statement of operations for the nine months ended September 30, 2019.

As previously disclosed in our 2018 Form 10-K, on February 12, 2019, the Company completed the sale of its interests in Thai Education Holdings Company Limited, a Thailand corporation (TEDCO), and Far East Stamford International Co. Ltd. (FES), a Thailand corporation. TEDCO was the owner of a controlling interest in FES, which was the license holder for Stamford International University, which had three campuses in Thailand. The total purchase price was approximately $35,300, and net proceeds were approximately $26,400, net of debt assumed by the buyer and other customary closing adjustments and fees. Of the $26,400 in net proceeds, $22,200, or $18,800 net of cash sold, was received at closing. The balance of $4,200 was payable upon satisfaction of certain post-closing requirements; the first post-closing requirement was satisfied in May 2019 and the Company received $2,800, leaving a remaining receivable of $1,400. The Company recognized a gain on the sale of approximately $10,800, which is included in gain on sales of discontinued operations on the consolidated statement of operations for the nine months ended September 30, 2019.

As previously disclosed in our 2018 Form 10-K, on January 25, 2018, the Company completed the sale of LEI Lie Ying Limited (LEILY). A portion of the purchase price was held back and subject to deduction of any indemnifiable losses payable to the buyer pursuant to the sale purchase agreement. On January 25, 2019, Laureate received HKD 71,463 (approximately US $9,100 at date of receipt) for the second and final holdback payment, net of legal fees. Also, as of December 31, 2018, the Company had recorded a liability of approximately $14,300 related to loss contingencies for which the Company had indemnified the buyer. During the first quarter of 2019, the legal matter that this loss contingency related to was settled, with no cost to the Company. Accordingly, during the first quarter of 2019, the Company reversed the loss contingency and recognized additional gain on the sale of LEILY of approximately $13,700, which is included in gain on sales of discontinued operations on the consolidated statement of operations for the nine months ended September 30, 2019. The remaining liability recorded relates to certain legal fees. Additionally, at the closing of the sale on January 25, 2018, a portion of the total transaction value was paid into an escrow account and will be distributed to the Company pursuant to the terms and conditions of the escrow agreement. As of both September 30, 2019 and December 31, 2018, the Company has recorded a receivable of approximately $25,900 for the portion of the escrowed amount that the Company expects to receive.

On April 8, 2019, the Company completed the sale of its institution in South Africa, Monash South Africa, as well as the sale of the real estate associated with that institution. The transactions consisted of: (i) the transfer by Monash South Africa Limited (MSA), an Australia limited company that is an indirect 75%-owned subsidiary of the Company, to The Independent Institute of Education Limited (IIE), a South Africa limited company that is a subsidiary of ADvTECH Limited, of all of MSA’s assets and

certain of its operational liabilities for a sale price of 15,000 South African Rand (ZAR) (subject to customary adjustments) (or approximately $1,100 at the closing date) and (ii) the sale by LEI AMEA Investments B.V., a Netherlands limited company that is an indirect wholly owned subsidiary of the Company, of all of the shares of Laureate South Africa Pty. Ltd. (LSA), a South Africa limited company, to IIE for a net sale price of approximately ZAR 99,000 (subject to customary adjustments) (or approximately $7,000 at the closing date). In addition, IIE assumed debt of approximately $20,200. In the aggregate, including working capital adjustments, the Company received approximately $9,000 from the buyer, which approximated the amount of cash sold with the business. The Company recognized a gain for these transactions of approximately $2,300, which is included in gain on sales of discontinued operations on the consolidated statement of operations for the nine months ended September 30, 2019.

On May 9, 2019, LEI Singapore Holdings Pte Limited, a Singapore corporation, Laureate I B.V., a Netherlands private limited company (Laureate I), and Laureate International B.V., a Netherlands private limited company (collectively, the India Sellers), all of which are indirect wholly owned subsidiaries of the Company, closed a transaction pursuant to the share purchase agreement (the India Agreement), among the India Sellers, Global University Systems India Bidco B.V., a Netherlands private limited liability company (the India Purchaser) and Global University Systems Holding B.V. (the India Purchaser Guarantor), a Netherlands private limited liability company. Pursuant to the India Agreement, the India Purchaser acquired from the India Sellers all of the issued and outstanding shares in the capital of Pearl Retail Solutions Private Limited, an India corporation (PRS), M-Power Energy India Private Limited (M-Power), an India corporation, and Data Ram Sons Private Limited (Data Ram), an India corporation. As a result of the closing of the transaction, the Company no longer consolidates its network institutions in India, including Creative Arts Education Society (CAES), the operator of Pearl Academy, and University of Petroleum and Energy Studies (UPES). In connection with the India Agreement, certain of the India Sellers also closed a separate transaction with the minority owners of PRS relating to the purchase by them of the minority owners’ 10% interest in PRS.

The total purchase price under the India Agreement was $145,600. The net proceeds received by the India Sellers, before the payment to the 10% minority owners and after transaction fees and taxes, including receipt in July 2019 of certain taxes withheld at closing, were approximately $145,800, or approximately $77,300 net of cash sold, which the Company used to repay indebtedness under its term loan that had a maturity date of April 2024 (the 2024 Term Loan). The Company recognized a gain for these transactions of approximately $19,500, which is included in gain on sales of discontinued operations on the consolidated statement of operations for the nine months ended September 30, 2019.

On May 31, 2019, Iniciativas Culturales de España S.L., a Spanish private limited liability company (ICE), and Laureate I, both of which are indirect wholly owned subsidiaries of the Company, closed a previously announced transaction pursuant to the sale and purchase agreement (the Spain and Portugal Sale Agreement) with Samarinda Investments, S.L., a Spanish limited liability company (Samarinda). Pursuant to the Spain and Portugal Sale Agreement, Samarinda acquired from ICE all of the issued and outstanding shares in the capital of each of Universidad Europea de Madrid, S.L.U., Iniciativas Educativas de Mallorca, S.L.U., Iniciativa Educativa UEA, S.L.U., Universidad Europea de Canarias, S.L.U., and Universidad Europea de Valencia, S.L.U. (together, the Spain Companies), and Samarinda acquired from Laureate I all of the issued and outstanding shares in the capital of Ensilis—Educação e Formação, Unipessoal, Lda. (the Portugal Company). Three of the Spain Companies are the entities that operate Universidad Europea de Madrid, Universidad Europea de Canarias, and Universidad Europea de Valencia. The Portugal Company is the entity that operates Universidade Europeia, a comprehensive university in Portugal, and Instituto Português de Administração de Marketing (IPAM Lisbon and IPAM Porto), post-secondary schools of marketing in Portugal.

The total purchase price under the Spain and Portugal Sale Agreement was EUR 770,000 (or approximately $857,000 at the date of closing), subject to customary closing adjustments. After payment of transaction fees, receipt of working capital and other adjustments, as well as settlement of foreign currency swaps, the total net proceeds received by ICE and Laureate I were approximately $906,000, or approximately $760,000 net of cash sold, which the Company used to repay indebtedness, including full repayment of the remaining balance outstanding under the 2024 Term Loan. Additionally, the buyer assumed debt of approximately $109,000. The Company recognized a gain for these transactions of approximately $615,000, including a tax benefit of approximately $30,000 that relates to the reversal of net deferred tax liabilities, which is included in gain on sales of discontinued operations on the consolidated statement of operations for the nine months ended September 30, 2019.

On August 27, 2019, Laureate I B.V. and Can Uluslararasi Yatirim Holding A.Ş. (Can Holding), a Turkish company, executed and closed a Sale and Purchase Agreement (the Turkey SPA). Pursuant to the Turkey SPA, Can Holding purchased from Laureate I B.V. 100% of the share capital of Education Turkey B.V. (ET), a private limited liability company incorporated under the laws of the Netherlands. ET and certain of its direct and indirect subsidiaries and affiliates together have the right to appoint a majority of the Trustees of Bilgi Eğitim ve Kültür Vakfı (Bilgi Foundation). Bilgi Foundation is the sponsor of Istanbul Bilgi University (Bilgi), an institution located in Turkey that the Company previously consolidated under the variable interest entity model. As a result of the closing of the Turkey SPA on August 27, 2019, the Company no longer consolidates Bilgi.

The total purchase price was $90,000, which consisted of cash proceeds of $75,000 and deferred purchase price of $15,000 in the form of an instrument payable one year after closing. The deferred purchase price carries no stated interest rate. At the date of sale, Bilgi had approximately $89,000 of cash and restricted cash on its balance sheet. The Company recognized a loss for this transaction of approximately $37,000, which is included in gain/(loss) on sales of discontinued operations on the Consolidated Statements of Operations for the three and nine months ended September 30, 2019.