Reply #5: Edison Schools, Inc. [View All]

[soup]

Edison's Failing Grade

Investors and school districts are ditching the country's leading public education privatizer

By Tali Woodward
Special to CorpWatch
June 20, 2002 <------ !!!!! note date

A year ago, Edison Schools Inc. was flying high. With 133 schools under its control, Edison had quickly become the nation's largest for-profit manager of public schools. And the public education funding that the company was tapping into seemed to provide a potentially limitless revenue stream. Founder Chris Whittle had predicted that, by 2020, Edison would run one in ten public schools in the United States. The company was a hit with Wall Street: shares were trading at $38, up from $18 when Edison went public just over two years earlier.

Now shares of Edison are changing hands for about a dollar, the minimum price required to stay listed on NASDAQ. Edison has racked up $250 million in losses since it began. The company announced June 3 that it had secured the $40 million investment it needs to open school in the fall. But the futures of 74,000 kids in Edison schools from Maryland to California remain tied to a company that is financially unstable. Edison's economic troubles raise renewed questions about the wisdom of turning public schools over to for-profit corporations -- and could pose a major setback for the school privatization movement.

Edison is still reeling from a three-month inquiry into the company's finances by the Securities and Exchange Commission. Investigators determined that the company consistently misreported revenues, providing an unduly rosy picture to investors. For example, Edison reported $375.8 million in revenue in fiscal 2001. According to the SEC's May 14 order, $154 million of that never passed through the company: it was spent by school districts on salaries for teachers and other staff at schools run by Edison. The SEC also found that Edison does not have an adequate system of internal accounting controls in place.>snip<
full article:
http://www.corpwatch.org/issues/PID.jsp?articleid=2688


Parents Advocating School Accountability (PASA)

We are public-school parents and advocates who see firsthand that our schools can work. We know that the attacks are unjust and misdirected. In a complex and changing society, our schools face far greater challenges than ever. They need support, not savagery. Exploitation of children by business, civic leaders and journalists should outrage the public.

Our mission is to build support for schoolchildren, classrooms, teachers and communities.

Click here for Edison Schools coverage and media archive.

extensive list of links at the above site, including:
* Lists of cancelled contracts
* Shareholder Lawsuits
* Media Coverage of Edison Schools


The only comment I can think of right now is WTF?!