K12 Inc. shares jumped Wednesday after the online education company said that it plans form a new company with the help of an investor group.
The company said Tuesday that the new company would focus on the expansion and use of technology-based learning programs from pre-kindergarten through college on a global basis. It would do so through the management and expansion of several existing early stage businesses and other investments in the education sector.
K12, based in Herndon, Va., said it will form the new company with an investor group led by Safanad Ltd., an investment firm based in New York and Dubai. The investor group would own a majority stake in the new company. K12 would own an initial minority stake in the company greater than 25 percent.
The companies are finalizing agreements and plan to provide additional financial and operational details in the coming weeks.
K12 said that Ron Packard, its founder and former CEO, has resigned from K12 and will lead the new company as its CEO. He will continue to serve on K12's board. Nate Davis has been appointed as K12's new CEO and will continue to serve as chairman of its board.
Shares of K12 jumped $1.30, a more than 6 percent gain, to $22.82 by early afternoon. They are still well below their 52-week high of $38.14 hit in September.