There is a lot of merger and acquisition activity in the training industry right now. Personnel Decisions International (PDI) and Ninth House announced today that the two companies are combining to create PDI Ninth House. (Click here to see the press release). You should also expect that Korn/Ferry International will announce today (or very soon) they will acquire Lore International Institute.
Is this a sign of the times? I think it is. We have a very fragmented industry where no one company has more than 1% of market share. This is not common in multi-billion industries. So don’t be surprised to hear about more in the next few months. And don’t expect it to stop there. This is not only a trend, but the characteristics of an industry with so many companies with diversified capabilities. You should also expect that many of the future acquisitions will be by private equity firms. It appears there are a lot of eyes on our industry right now.
The magic question is when will we have our first $1B training company? My bet is we’re not very far from it; maybe in the next couple of years. It’s rare to have an industry as large as ours (more than $130B US) and not have a company that leads in size. None have approached the $500m yet. And no, IBM and Accenture do not count because training revenues do not exceed this number.
