Sylvan Learning Systems Launches New International University Venture.

BALTIMORE--(BUSINESS WIRE)--Jan. 20, 1999--

Sylvan Taps U.S. Information Agency Director Joseph Duffey To

Lead New Effort; Announces Intention to Acquire Controlling

Interest in Spanish University

Sylvan Learning Systems, Inc. (NASDQ:SLVN) Wednesday announced it has taken the first steps in a new venture to own and operate a network of major universities in large international markets.

Dr. Joseph Duffey, director of the United States Information Agency (USIA) and former president of American University and Chancellor of the University of Massachusetts, will join Sylvan effective February 1, 1999 to manage this venture. Also, Sylvan said it has entered into an agreement providing an exclusive option to acquire a controlling interest in the Universidad Europea de Madrid, a for-profit university. The company expects, if an acquisition contract is finalized, that a closing would not occur until the second or possibly third quarter due to the need for regulatory approval in Spain.

Sylvan's analysis of the international education market has shown that many large foreign countries, in contrast to the United States, severely restrict access to university education due to limited funds. In these countries, rising income levels and increasing aspirations of the middle class are generating a growing demand for higher education. Currently, more than 1.3 million students are pursuing university and advanced degrees outside of their home countries. In 1995, more than 400,000 foreign students spent $7 billion on higher education in the United States. Overseas, this demand has spurred the development of private and for-profit universities in certain key markets. Sylvan has identified a target list of markets, initially focusing on Europe and Latin America, in which it plans to operate for-profit universities. The company chose Spain as its first university market, according to president and co-CEO Douglas L. Becker, "after careful consideration, because of its growth, stability and ability to serve as a bridge to both Europe and Latin America."

Sylvan said it has entered into an agreement providing an exclusive option to acquire 54 percent of the shares of Universidad Europea de Madrid (UEM) for approximately $51 million. The purchase price would include payment of approximately $28.5 million in cash and the assumption of approximately $22.5 million in existing debt. Total Revenues for the year ended December 31, 1998 for UEM are estimated to be $49 million and recurring earnings before interest, taxes and depreciation are estimated to be $15.5 million. Founded in 1985, UEM is a private university located in Villaviciosa de Odon, a suburb of Madrid. It has a faculty of 480, and offers 20 degree programs. The university's current enrollment of approximately 7,200 has doubled since 1995, when it received authorization to become a full university.

Becker commented, "UEM is the largest for-profit university in Spain, which has allowed private universities only since 1991. With its excellent faculty, high quality courses, and exceptionally advanced facilities, UEM has the potential to become one of Spain's most highly regarded universities, and will serve as an excellent launching point for our new venture."

As a member of Sylvan's senior management team, Dr. Joseph Duffey will provide leadership and strategic direction to Sylvan's international university venture. Named Director of the United States Information Agency by President Bill Clinton in April 1993, Duffey previously served as President of The American University in Washington, D.C. from 1991 to 1993 and Chancellor of the University of Massachusetts at Amherst from 1982 to 1991. Also, Duffey was United States Assistant Secretary of State for Educational and Cultural Affairs and Chairman of the National Endowment for the Humanities under Presidents Jimmy Carter and Ronald Reagan. Prior to serving as Assistant Secretary of State, he was a member of the faculty at Yale University and a Fellow of the JFK School of Government at Harvard University.

"We are tremendously pleased that Joe Duffey, a man who is such a respected leader in the worlds of higher education and international relations, will be working to help us to realize our vision in international higher education," Becker continued. "The USIA plays a key role in informing foreign students about educational opportunities in the United States. Joe's background there, coupled with his experience in leadership positions at two of America's most prestigious universities, will enable him to provide Sylvan with unique insight into the needs and demands of this student population."

Duffey commented, "Today we are seeing a steady increase around the world in the number of families seeking a university education for their children. They seek quality, career-oriented higher education. More students are leaving their home countries to attend universities in the United States and elsewhere, and enrollments are growing in private universities throughout Europe and Latin America, and also in Asia. I believe we are on the brink of a significant expansion in universities outside of the U.S., and I look forward to working with Sylvan at the leading edge of this trend."

Sylvan Learning Systems, Inc. is the leading provider of educational services to families, schools and industry. The company provides lifelong educational services through three divisions: The Sylvan Prometric division delivers computer-based testing for academic admissions, Information Technology and professional certification programs; the Sylvan Learning Centers division provides personalized instructional services to students of all ages and skill levels; and the Sylvan Contract Educational Services division provides supplemental education, teacher professional development and consulting services under contract to large urban school districts. Sylvan subsidiaries include the PACE Group, which provides corporate consulting, training and professional development services, the Canter Group, which produces training, development and graduate degree programs for teachers, Wall Street Institute and ASPECT, which deliver English language instruction to adult professionals and college students. Through its affiliate, Caliber Learning Network, Inc., Sylvan has the ability to distribute world-class adult professional education and training programs. Sylvan's services are delivered through its network of more than 3,000 educational and testing centers around the globe.

This release may include information that could constitute forward-looking statements made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. Any such forward-looking statements may involve risk and uncertainties that could cause actual results to differ materially from any future results encompassed within the forward-looking statements. Factors that could cause or contribute to such differences include those matters disclosed in the Company's Security and Exchange Commission filings.

NOTE: Sylvan Learning Systems, Inc. management will hold a conference call today at 8:45 a.m. Eastern Standard Time to discuss this announcement. The call-in number is 888/243-0811, pass code SLVN.