In The Sun Also Rises, the character Mike Campbell is asked how he went bankrupt. The answer “Two ways. Gradually then suddenly.”, seems to reflect the story behind Study Group’s brisk sale to a consortium of Global University Systems and Brightstar Capital Partners. It’s a sign that the financial crisis enveloping UK universities and some of their US counterparts is being felt up and down the enrollment supply chain.
There are some interesting linkages that weave a path through three of the larger pathway operators and the current financial situation. It suggests we may be seeing the unravelling of the structure that helped fuel the surge in international students in the first two decades of the 21st century.
To Have and Have Not
Study Group’s website calls the business, “the smartest choice in global education”. With 14 listed UK partner operations, including four in the Russell Group, and 13 more across the US, Canada and Ireland its portfolio looks as strong as most in the pathway sector. But it has been a long steady decline from the heady days of 2010 when Providence Equity Partners stumped up $570m to buy it from CHAMP Private Equity.
The price reflected the mistaken belief of private equity investors that the US was about to become home to a new international student enrollment gold rush. In 2019 Study Group was changing hands again with Ardian paying around £500m but its troubles were increasingly evident. It sold its Australian operations to Navitas in 2023 and was recapitalized in 2025 with new funding from Intermediate Capital Group and Bain Capital as majority owners.
Everyone seems to have been content to inject substantial sums of money into the business with the 2025 new majority holders suggesting they were “highly optimistic” about its prospects. Yet Study Group’s accounts to 31 December 2024 suggest the growing scale of investment just to keep afloat. During 2025 Ardian had put in another £5m and there was a “further £10.0m investment from Study Group’s lenders in May 2025”. All this came after Ardian had (according to the 31 December 2022 Annual Report and Financial Statements) invested £77m across 2021, 2022 and 2023.
The 2025 investment is claimed to reflect “continuing confidence in Study Group’s growth strategy and leadership.” It is perhaps interesting to note that the strategy involved assumptions of 20% student volume growth in 2026 and the company Directors considering “downside scenarios to be remote.”
The end came quickly. Companies House in the UK captures HSBC registering a “Charge Over Cash Deposit” on 30 April 2026. It is understood that BDO, who offer specialist restructuring services, became joint administrators of Study Group UK Limited with GUS and Brightstar making an offer for parts of the business on Friday 8 May.
There is plenty of potential for further fallout as the dust settles. There is the significant matter of whether Study Group’s UKVI licence is fully transferable into a new business. Another strand is the future of the partnership with Twin Group to deliver the Bellerby’s foundation programme in the UK.
Another twist in the tale relates to Voyager House in Brighton which Study Group sold in 2022 for a reported £8.4m. It still operates from the building as a tenant with student accommodation company Mezzino as the managing agent. The building’s owners since 2022, according to the UK Land Registry, are registered as Espalier Nominee 1 Limited and Espalier Nominee 2 Limited which are part of the broader interests of INTO’s owner Andrew Colin.
For Whom The Bell Tolls
Continuing with the Espalier theme, it is interesting to see that Companies House filings tell us that on 30 April 2026 Espalier Ventures Limited became a lender to INTO University Partnerships. In INTO’s accounts to July 2024 it was noted that there was a £35m facility with HSBC Bank plc running to February 2026 of which £20.2m had been drawn. The next financial statement might give some more insight into how this is working.
In recent years INTO has filed its accounts at Companies House by the end of April but this year there has been a delay until 31 July 2026, so we will have to wait a little longer to see recent trading performance. The same goes for the individual joint venture companies. What we can glean from university partner annual reports for the year ended July 2025 is that the picture is, at best, mixed.
The University of Exeter indicates that its share of operating surplus/deficit went from +£1.27m in 2023/24 to -£749k. The university notes a “£1.1m loan to fund working capital requirements of INTO University of Exeter LLP”. The University of East Anglia indicates that its share of the joint venture operating pre-tax loss grew from £1.13m to £1.65m. It also reflected that its loan of £6.45m to the JV had been adjusted to see £3.5m classified as a “capital investment” and £2.95m as a loan receivable. The bad news was that “given the current financial position of the Joint Venture, the full value of the loan has been provided for in the Consolidated Statement of Income and Expenditure, reflecting uncertainty over recoverability.”
Newcastle University (now a 49% stakeholder in the joint venture with INTO) saw its share of operating surplus fall from £0.7m to £0.5m, while City St George’s University (a 50% stakeholder but with only a 15% profit share) saw its profit share fall from £92k to £30k which implies the overall surplus fell from £600k to £200k.
The Celtic fringe of INTO’s portfolio, Queens University Belfast and University of Stirling both consolidate performance of joint ventures into the universities overall accounts so it is not simple to disaggregate the INTO partnership performance. It seems likely that the Queen’s joint venture made a small loss but the University of Stirling figures will have to be revisited when the JV reports towards the end of July.
Across the pond there has already been reporting on the enrollment performance across US entities but the Spring 2026 numbers at Oregon State University are less than encouraging. There’s a year-on-year decline of 125 students (from 293 down to 168) on INTO programs. Graduate and undergraduate pathways account for 75 of the reduction.
Staying in the US there are now 863 documents relating to the INTO versus University of South Florida case in Hillsborough County Court, which suggests a lot of hours, a lot of lawyers and a lot of dollars invested. There’s a Zoom hearing scheduled for May 18, 2026 where USF will be arguing to allow supplementary information to confirm that “..the passage of time and actual, relevant data have now demonstrated that projections for two years (FY24 and FY25) of Dr. Deramus’s projection period are overstated and speculative.” For new readers Dr Deramus is an expert witness in calculating “damages projections” for INTO.
Winner Take Nothing
Shorelight developed a version of the INTO model that made them the dominant player in the US pathway scene. The company pivoted rapidly to look more like an aggregator than a pathway operation when COVID hit but it has become difficult to escape the headwinds facing US international enrolments. Total enrolled international students in the US in 2024/25 remained below the numbers in 2015/16 and the predictions for 2025/26 are gloomy.
One measure is that Huron Consulting Group began investing in Shorelight in 2014 and continued to do so up to a sum of $40.9m. In its quarterly filing of May 5, 2026, Huron gave the “fair value of the investment” as $34.1m which includes a $10.4m allowance for credit losses. The investment is considered as “available for sale debt security”, if a buyer happens along, with an assumed holding until January 17, 2027. The fair value does not seem to be a vote of confidence in the value or future of the business.
The Torrents of Spring
“If winter comes can spring be far behind?” is a quote from Hemingway’s novel The Torrents of Spring but for pathway operators the quote could be reversed. Spring is always the moment where the shape of the year’s main Autumn/Fall enrollment becomes clear in the northern hemisphere. A poor start to the season is difficult to make up and the best laid financial plans can look outdated.
Just as universities are finding the going tough and having to adjust to new realities the pathway operators are having to adjust. The Study Group deal opens a door on vertical integration which may offer new ways of being and there is still the potential for consolidation across the sector.
NOTES
As always, the information given is an honest attempt to understand and communicate complex issues. Any authoritative comments or factual amendments will be considered with amendments to the text being made if appropriate.
All sub-headings are taken from Ernest Hemingway book titles. The Quote Investigator gives reasonable support to substantiate one of Hemingway’s best quotes and a good rule for life, “Always do sober what you said you’d do drunk: That will teach you to keep your mouth shut.”
Image by San Fermin Pamplona – Navarra from Pixabay