To date, more than 15 Chinese education companies have gone public in overseas capital markets. Among them, the ones listed on U.S. stock exchanges include New Oriental, Tomorrow Advancing Life, Tarena International, Inc., Hailiang Education, China Distance Education Holdings Ltd., China Distance Education Holdings Ltd. (CDEL), ATA, 51Talk and Bright Scholar. The ones that have gone public in Hong Kong include Maple Leaf Education, Yuhua Education, Virscend Education, Wisdom Education, Minsheng Education and China New Higher Education Group. In China’s domestic market, many listed companies are entering the education market through mergers and acquisitions (M&A).

 

New Oriental

Established in: 1993

Year of IPO: 2006

Listed in: the United States

New Oriental Education and Technology Group developed from the Beijing New Oriental School established on November 16, 1993, with language training as its core business. It was listed on the New York Stock Exchange (NYSE) on September 7, 2006, becoming China mainland’s first educational and training institution that went public overseas.

Investment & M&A: According to statistics by Pedata, since 2008, New Oriental has made more than 50 overseas investments, mergers or acquisitions. Among them, there were 15 in 2017, with 16 boasts transaction amount of more than RMB 50 million. The typical investment M&A cases, in particular, include a joint acquisition of Tarena International, Inc. (RMB 83.05 million, April 2014), a joint acquisition of Boxfish with RMB 100 million in April 2018, taking the lead in an A-round investment in EEO Education Ltd. with RMB 62.6 million in March 2017, and investment in Yixue Education with RMB 120 million in 2016.

 

 

Tomorrow Advancing Life

Established in: 2003

Year of IPO: October 2010

Listed in:  the United States

Tomorrow Advancing Life, formerly known as Xueersi, was founded in 2003. It focuses on providing education services for students from birth to 24. It owns five flagship brands: Xueersi Peiyou, Zhikang One-to-One, Mobby Stem Center, Study and Deliberate Net and JZB. In August 2014, the former E-forum was formally renamed JZB Community. Among them, Xueersi Peiyou is its K-12 high-end education platform with three sub-brands: Xueersi School of Science, Lejiale English and East School Chinese.

Investment & M&A: Since 2016, it has completed a total of 22 investments, among which involving large investment includes $50 million USD in Dada ABC in January 2018, and co-investment in EEO, together with New Oriental in March 2017.

 

RYB Education

Established in: 1998

Year of IPO: September 2017

Listed in:  the United States

As of 2017, RYB Kindergarten has more than 1,300 day care centers and nearly 500 kindergartens in more than 300 cities in China. In April 2017, it was involved in a highly controversial child abuse incident.

Investment & M&A: On June 30, 2018, Beijing RYB Children Education & Technology Development Co. Ltd. invested millions of RMB in Beijing No Boundary Education Consulting Co. Ltd.

 

 

Hailiang Education

Established in: August 1995

Year of IPO: July 2015

Listed in: the United States

This is China mainland’s first full-time basic education school listed in the United States. Its services cover high school, junior high school, primary school, kindergarten and international education. At present, it has more than 60,000 teachers and students at home and abroad. Currently, it expands its business mainly by hosting public schools and cooperating with local governments in building education industrial parks.

Investment & M&A: It obtained an 80 percent stake in establishing Hubei Xiantao No. 1 Middle School with RMB 224 million on June 21, 2018.

 

Bright Scholar

Established in: 2014

Year of IPO: May 2017

Listed in: the United States

Bright Scholar, formerly Country Garden Education Group, is one of the oldest international education groups in China. It has six international schools, 16 bilingual schools and 40 kindergartens in eight provinces across the country. It also has 18 English training centers in Beijing, Shanghai, Shenzhen and Foshan. As of April 2018, it has a total of more than 35,000 students.

 

51Talk

Established in: 2011

Year of IPO: June 2016

Revenue: $130 million USD (fiscal year 2017, as of December 31, 2017, a year-on-year increase of 102.7 percent)

Net profit: $89.27 million USD, a year-on-year increase of 13 percent

51Talk English is China’s first online education company listed in the United States. Initially, 51Talk focused on providing English language services for adults, and gradually expanded its English training to the field of kids and teenagers.

 

Maple Leaf Education

Established in: 1995

Year of IPO: November 2014

Listed in: Hong Kong

Headquartered in Dalian, Maple Leaf Education provides K-12 education in 21 cities in China and British Columbia, Canada. As of March 31, 2018, it has 29,991 students, 2,754 teachers and 77 schools in China and Canada.

Investment & M&A: On June 21, 2017, Maple Leaf Education acquired 47.6 percent and 4.9 percent equity of Hainan Science and Education Group from the original shareholders with RMB 77.58 million and RMB 7.497 million, respectively.

  

 

Yuhua Education

Established in: 2001

Year of IPO: February 2017

Listed in: Hong Kong

Yuhua Education Group is a large education group integrating pre-school education, basic education and higher education. It has 25 well-known schools, ranging from kindergarten to university. It has campuses in nine cities in Henan province. It is the China’s largest education group providing education from kindergarten to non-government universities, with campus located around 10 cities in Henan and Hunan provinces, boasting more than 90,000 teachers and students.

Investment & M&A: On June 28, 2018, it acquired two private schools in Hunan province for RMB 1.43 billion, including the acquisition of 100 percent equity of Lei Lie Ying Ltd. that indirectly holds non-government Hunan International Economics University, the Hunan Falcon Technical School, and the Vocational Skills Training Center of Hunan International Economics University.

 

 

Virscend Education

Established in: 2000

Year of IPO: January 2016

It is the largest private education service provider of education from pre-school to 12th grade in southwest China. So far, it has established and is operating five schools providing pre-school to a 12^th-grade education, as well as a university.

Wisdom Education

Established in: October 2002

Year of IPO: January 2017

Wisdom Education is the largest private education group operating high-end primary and secondary schools in South China. As of September 1, 2017, it has seven schools with 41,180 enrolled students.

Investment & M&A: On April 16, 2018, it acquired Weifang Weizhou Foreign Language School for RMB 111 million.

 

 

Major K-12 Education Companies in an A-share Market

 

Vtron Group

Vtron Group has been engaged in research and development (R&D), manufacturing, marketing and services of an ultra-high resolution digital splicing wall system. Since 2015, it entered the early childhood education industry by acquiring Hoing Education, Golden Cradle, Keer Education and Dingqi Kindergarten. As of December 31, 2017, the preschool brands under the group have   franchised nearly 5,000 kindergartens. In terms of market share, it enjoys the largest number of kindergartens in the preschool education industry.

Revenue: Vtron Group achieved revenue of RMB 1.14 billion in 2017, a year-on-year increase of 8.27 percent, of which RMB 478 million from early childhood education, accounting for 42.11 percent.

  

Kaiwen Education

Kaiwen Education was formerly known as Zhongtai Bridge. In July 2016, Zhongtai Bridge raised RMB 1.2 billion through non-public offerings and established the Chaoyang Kaiwen School Project by investing in Wenkaixing. In January 2017, Zhongtai Bridge indirectly held 100 percent equity of Haidian Kaiwen School through the buyout of Kaiwen Zhixin and Kaiwen Xuexin. On November 24, 2017, Zhongtai Bridge completed the divestitures of its original bridge steel structure business. On December 27, 2017, Zhongtai Bridge was renamed Kaiwen Education.

Revenue: RMB 91.62 million (Education and education-related business)

Investment & M&A: On June 21, 2018, it acquired the related assets of Westminster Choir College, Westminster Conservatory of Music and Westminster Continuing Education under Rider University in Princeton, New Jersey, and took over the operation of these three colleges.

 

Q-tone Education

Established in 2005, Q-tone Education was listed in 2014. With such products as qky100 and qk100, it focuses on operating internet applications and information services in China's K-12 basic education field.

Revenue: In fiscal year 2017, the company achieved revenue of RMB 1.031 billion and net profit of RMB 66.2916 million.

Investment & M&A: It invested in Xi'an Xiyue, Hangzhou Sysion, Hebei Huangdian, Hubei Yinxin, Guangxi Huigu and some other home-school interactive companies. It also invested in Wisdom Garden Holdings Ltd., a provider of university information services. It also acquired www.teacher.com, an online remote continuing education platform for primary and secondary school teachers.

 

Shanghai Xin Nanyang Co. Ltd.

Shanghai Xin Nanyang Co. Ltd. is based on relying on K-12 education, vocational education, international education, early childhood education and other services provided by Only Education. On August 23, 2013, Shanghai Xin Nanyang Co. Ltd. (formerly Shanghai Jiaotong University Nanyang Co. Ltd.) planned to acquire a 100 percent stake of Shanghai Only Education Technology Co. Ltd. with RMB 582 million. On August 21, 2014, the transaction was completed.

Revenue:

In fiscal year 2017, its revenue from education and training business was RMB 1.494 billion, with year-on-year growth of 26.16 percent, accounting for 86.67 percent of the company's total revenue; net profit was RMB 93.8672 million, with year-on-year growth of 13.26 percent.

Investment & M&A

In March 2015, it initiated the establishment of an education industry investment fund with a total of RMB 1 billion.

 

Lanxum

Established in 1999 and listed in 2009, Lanxum currently focuses on education and information security. It plans to focus on education business by fully divesting the assets related to its information security business.

Revenue: Its education products and management solutions contribute to revenue of RMB 1.2 billion, accounting for 55.57 percent of its total revenue.

Investment & M&A: In February 2017, Lanxum and Jingle Investment jointly established the first international education industry investment fund, with the participation of Beijing New Channel in the fund investment. The fund aims to raise funds of RMB 1.2 billion.

  

Kingswood

In December 2017, it acquired 49.76 percent equity of Longmen Education with RMB 757 million. Longmen Education, a service provider in K-12 education and training, focuses on serving the middle- and high-school entrance examination training market segment. It is a comprehensive education service organization integrating education, training, product development and teaching research.

Revenue: In 2017 Longmen Education achieved net profit of RMB 105 million that shall be distributed to its parent company.

Investment & M&A: In April 2018, Kingswood announced that its holding subsidiary Longmen Education intended to establish an equity investment partnership joint venture fund Guochuang Lundao with  joint investment by Guodu Venture Capital. The total fund size aims to be RMB 200 million.

 

The Great Wall

In 2015, The Great Wall entered the education industry by acquiring Guangdong Lianxun Education. With cloud computing, Internet of Things (IoT) and mobile internet as its core technologies, Lianxun Education commits to developing an integrated intelligent education cloud solution, providing public services of educational resources and education management, and management service of safe campus for primary and secondary schools.

Revenue: In 2017, its education system integration and operation business and education and training business achieved revenues of RMB 226 million and RMB 118 million respectively, accounting for 8.40 percent and 5.51 percent of its total revenue respectively.

Investment & M&A: On January 20, 2015, it acquired a 20 percent stake in Guangdong Lianxun Education Technology Co. Ltd. with RMB 40 million.

On February 15, 2016, it acquired the remaining 80 percent stake in Guangdong Lianxun Education Technology Co. Ltd. with RMB 537 million.

On March 30, 2018, it acquired a 100 percent stake in Beijing Emerald Education Technology Group Co. Ltd. with RMB 1.575 billion. Beijing Emerald Education is an IT training organization specializing in mobile internet and digital entertainment.

 

Hodgen Technology

In November 2016, Hodgen Technology entered the K-12 education industry by acquiring Beijing Huanyu Wanwei Technology with RMB 15 million. The wisdom tree preschool cloud developed by Huanyu Wanwei is mainly targeted at kindergarten teachers, teachers and parents, focusing on building an integrated service education platform.

Investment & M&A: On November 17, 2016, Wuxi Hodgen Technology Co. Ltd. successfully acquired 44.61 percent equity of Beijing Huanyu Wanwei Technology Co. Ltd. with added investment of RMB 195 million.

  

Unigroup Xue

Xueda Education was established in 2001, with its business focusing on providing personalized counseling services for K-12 students. Currently, it has 621 learning centers in 127 cities across the country. It was listed on the Nasdaq in November 2010.

In June 2016, A-share listed company Insight Investment acquired Xueda Education Group for RMB 2.35 billion. Insight Investment was renamed Unigroup Xue in July 2016. After the acquisition, Xueda Education was delisted from the NYSE.