Edina executive will be next CEO of Capella Education Co.

Capella Education Co., which offers online college courses, announced Friday that businessman Kevin Gilligan will become CEO of the Minneapolis-based company.

Gilligan, top executive of United Subcontractors in Edina, will be charged with producing more revenue growth and ensuring that Capella University tailors its programs to a changing education marketplace, said Stephen Shank, Capella's founder.

Gilligan, 53, who earned his bachelor's degree in economics and political science from Boston College, worked for Honeywell for several years and said in a Friday statement that he intends to emphasize customer service at Capella.

About 85 percent of Capella's students are enrolled in graduate programs, and Shank said that most of them are 35 to 45 years old. About three-fourths of them take out loans to finance their education.

Capella, which was founded in 1991, was experiencing double digit growth before the credit crisis hit the United States late last year, so Shank said he does not think the current recession will dramatically alter Capella's enrollment.

"We are more influenced by longer-term growth trends than the cyclical ups and downs of the economy," Shank said.

He added that many professionals and their companies believe in lifelong learning, and Capella has responded to that market demand.

Capella will report its fourth-quarter financial results Feb. 12. In its third quarter, Capella earned $5.8 million on $65.2 million in revenue, which was up 17.5 percent. About 24,000 students were enrolled at Capella, which offers 23 graduate and undergraduate degree programs.

The company's stock closed Friday at $59.17 a share, down $1.04 or 1.73 percent. Unlike most downtrodden stocks last year, Capella had a relatively flat 2008.

Shank said that the company focuses on continuous improvement, and Gilligan will be asked to find ways to create better learning experiences for students as well as produce better outcomes for the students.