EAI shares rise 12% on reports of pending contract in Conn.

August 31, 1994|By Bloomberg Business News

MINNEAPOLIS -- Education Alternatives Inc. shares gained 12 percent yesterday on reports it is close to signing a five-year contract with the Hartford, Conn., school system.

Shares of the Minneapolis-based company closed up $2, at $18.75. About 465,100 shares changed hands, more than four times its three-month daily average.

Education Alternatives and Hartford school officials said they have made progress in their negotiations and hope to agree on a contract early next week.

Neither side would comment on reports in the Hartford Courant and Minneapolis Star Tribune that Education Alternatives will get control of the entire $200 million school budget, including $29 million in federal grants.

Such a move would boost Education Alternatives' annual revenue to about $230 million from $30 million. Hartford negotiators initially had talked about a one-year, low-fee consulting agreement.

Hartford would be the first new customer in two years for Education Alternatives, which currently manages nine public schools in Baltimore. Its shares have risen 42 percent since last Wednesday.

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