Immediate release 31 May 2021
(Stock code: 2001. HK)
China New Higher Education Group acquires the remaining 10% equity interest of Guangxi Schools and insists on the direction of vocational education
China New Higher Education Group Limited ("New Higher Education Group", together with its subsidiaries collectively referred to as the "Group", stock code: 2001.HK) is pleased to announce the further acquisition of the remaining 10% equity interest of Songming Xinju, the sole shareholder of the Guangxi Schools Sponsor, at the consideration of RMB64 million. Following the completion of the 51% equity interest acquisition in January 2019 and the second acquisition of the 39% equity interest of Guangxi Schools in July 2020, so far the Group acquired the 100% equity interest of Guangxi Schools.
Guangxi Schools are full-time higher vocational education college approved by the Ministry of Education. Based on the local social development as well as the demand for technical and skilled talents, the Guangxi Schools provide more than 30 majors covering preschool education, nursing, e-commerce, computer network technology, etc. The Guangxi Schools have extensive school-enterprise cooperation with various renowned and high-quality enterprises across the nation, and the level of education and teaching has been steadily improved. In 2020, the Guangxi Schools ranked first in Guangxi in terms of employment rate, and were awarded the honorary title of the outstanding unit of employment and entrepreneurship for graduates of colleges and universities in Guangxi.
Prior to this acquisition, the Group have improved the quality of Guangxi Schools by means of strengthening internal construction, increasing teaching investment, optimizing campus environment and enhancing the experience of students and teachers, that Guangxi Schools' education quality has been improved significantly, the level of education and teaching has been steadily improved, the operational efficiency has been significantly enhanced, and the strength of the schools has been rapidly improved after the previous two acquisitions of the equity interest of Guangxi Schools. The further acquisition of the remaining 10% equity interest will enable the Group to give full play to its strength in centralized school operation, further unleash the potential of Guangxi Schools, enhance the quality of its education, and better serve the social and economic development of the Guangxi Autonomous Region while achieving the Group's high-quality development goals.
Further acquisition of 10% minority equity of Guangxi Schools will bring the Group with long-term benefits:
Firstly, the further acquisition of Guangxi Schools will enable the Group to give full play to its strength in centralized school operation, achieve high-quality education, fully release the potential of Guangxi Schools, serve the social and economic development of the Guangxi Autonomous Region, and realize social and economic benefits;
Secondly, the strategy of continuous increase in market penetration in region with high growth rate is further implemented. As the eighth largest province in terms of student source, the gross enrollment rate in Guangxi Zhuang Autonomous region is lower than the national average, while the growth rate of GDP in recent years is higher than the national average. Meanwhile, only a few universities are located in this region where the higher education services supply falls short of demand. The further acquisition of the remaining equity interest of Guangxi Schools will not only benefit the Group with the future growth potential of Guangxi Schools, but also bring better vocational education services for Guangxi;
Thirdly, the Beibu Gulf Economic Zone, in which the Guangxi Schools are located, is a strategic development zone in Guangxi Zhuang Autonomous Region under the "One Belt and One Road" initiative which possesses the regional advantage of covering the countries within the Association of Southeast Asian Nations and is the fastest growing region in Guangxi Zhuang Autonomous Region;
Lastly, the valuation of the further acquisition of Guangxi Schools is reasonable, and the PE ratio of this acquisition is lower than that of the first acquisition and the second acquisition.
"This acquisition of the remaining 10% minority interest of Guangxi Schools reflects the Group's determination to maintain the development direction of vocational education. We will further increase our investment in Guangxi schools, give full play to the advantages of the Group, strengthen the internal construction, further enhance the strength of school operation and the level of education and teaching of Guangxi Schools, and continue to provide more highly qualified technical and skilled personnel to the society so as to serve the local economic and social development." Mr. Li Xiaoxuan, Chairman of the Board of Directors of China New Higher Education Group said.
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About China New Higher Education Group Limited:
China New Higher Education Group Limited is a leading private higher education group in China with 22 years of education industry experience, specializing in providing higher education which focuses on applied sciences. The Group endeavors to help each student maximize their potential and live their life to the fullest. Since 2009, the Group has been operating schools in different provinces and regions, and its current school network covers 7 provinces in China, including Yunnan, Guizhou, Hubei, Heilongjiang, Henan, Guangxi, and Gansu. Schools under the Group were awarded the title of the Top 50 National Employment of the MOE, with an average employment rate of 98% approximately.
The Group became a constituent stock of the Hang Seng Composite Small Cap Index and the Hang Seng Consumer Goods & Services Index in the Hang Seng Composite Index Series in August 2017, and was included as a constituent stock of the MSCI China Small Cap Index in November 2017 and included as a constituent stock of Shenzhen and Hong Kong Stock Connect in March 2018.
This press release is distributed by Wonderful Sky Financial Group Limited on behalf of China New Higher Education Group Limited.
For further information, please contact:
Wonderful Sky Financial Group Limited
Aileen Wang / Jing Chen
Tel: (852) 3970 2226/ (852) 3970 2278
Fax: (852) 2598 1588
31/05/2021 Dissemination of a Marketing Press Release, transmitted by EQS Group.