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ChinaEdu Corporation Enters Into Definitive Merger Agreement for Going Private Transaction



ChinaEdu Corporation Enters Into Definitive Merger Agreement for Going Private
                                 Transaction

PR Newswire

BEIJING, Dec. 31, 2013

BEIJING, Dec. 31, 2013 /PRNewswire/ -- ChinaEdu Corporation (NASDAQ: CEDU)
(the "Company"), a leading online educational services provider in China,
today announced that the Company has entered into a definitive Agreement and
Plan of Merger (the "Merger Agreement") with ChinaEdu Holdings Limited
("Holdings") and ChinaEdu Merger Sub Limited ("Merger Sub"), pursuant to which
Holdings will acquire the Company for US$2.33 per ordinary share or US$7.00
per American Depositary Share ("ADS), each representing three (3) ordinary
shares. This represents a 19.9% premium over the closing price of $5.84 per
ADS as quoted by NASDAQ on June 19, 2013, the last trading day prior to the
Company's announcement on June 20, 2013 that it had received a "going private"
proposal, and a premium of approximately 22% to the volume weighted average
price of the Company's ADSs for the last 180 trading days.

Pursuant to the Merger Agreement and subject to the satisfaction or waiver of
its terms and conditions, Merger Sub, which is wholly-owned by Holdings, will
be merged with and into the Company, with the Company continuing as the
surviving corporation and a wholly-owned subsidiary of Holdings (the
"Merger"). In connection with and at the effective time of the Merger, all of
the Company's ordinary shares issued and outstanding immediately prior to the
effective time of the Merger (including ordinary shares represented by ADSs)
will be canceled and converted into and exchanged for the right to receive
US$2.33 per ordinary share or US$7.00 per ADS, in each case, in cash and
without interest and net of any applicable withholding taxes, except for (a)
all ordinary shares owned immediately prior to the effective time of the
Merger by Shawn Ding, Moral Known Industrial Limited, Julia Huang, South Lead
Technology Limited, GegengTana, Mei Yixin, Pan Zhixin, Ellen Huang,
InterVision Technology Ltd., MLP Holdings Limited, New Value Technology
Limited, LingyuanFurong Investment Mgmt Co., Ltd., McGraw-Hill Global
Education Intermediate Holdings, LLC, Weblearning Company Limited and Guo
Young (the "Rollover Shareholders"), which are subject to a contribution
agreement whereby such shareholders have agreed to contribute such shares
(except, in the case of McGraw-Hill Global Education Intermediate Holdings,
LLC ("McGraw-Hill"), limited to 3,377,336 ordinary shares held by it) (the
"Rollover Shares") to Holdings, which contributed Rollover Shares will, in
accordance with the contribution agreement, be exchanged for the right to
subscribe for the ordinary shares of Holdings, (b) ordinary shares and ADSs
beneficially owned immediately prior to the effective time of the Merger by
the Company as treasury shares, held in brokerage accounts in the Company's
name, or issued to The Bank of New York and reserved for future grants under
the Company's 2010 Equity Incentive Plan (the "Company Plan"), and (c)
ordinary shares owned by shareholders who have validly exercised and perfected
and not effectively withdrawn or lost their appraisal or other rights pursuant
to Section 238 of the Cayman Companies Law, as amended, which will be
cancelled and will entitle the former holders thereof to receive the appraised
value thereon in accordance with such holder's appraisal rights under the
Cayman Companies Law.

At the effective time of the Merger, each option to purchase ordinary shares
(each, a "Company Option") granted pursuant to the Company Plan that is then
outstanding and unexercised, whether or not vested, shall be cancelled and
converted into and exchanged for an option to acquire one fully paid and
non-assessable ordinary share of Holdings (each, a "Holdings Option"). Each
Holdings Option shall have an exercise or purchase price equal to the exercise
or purchase price of the corresponding Company Option. Each Holdings Option
shall otherwise retain the same grant date, the same vesting or exercise
schedule, the same term and expiration date and substantially the same other
material terms and conditions as each Company Option.

At the effective time of the Merger, each restricted stock unit granted
pursuant to the Company Plan (each, a "Company RSU") shall be cancelled and
converted into and exchanged for a restricted stock unit of Holdings (each, a
"Holdings RSU"). Each Holdings RSU shall be subject to the same material terms
and conditions as each Company RSU.

Holdings and Merger Sub are all newly-formed Cayman Islands exempted companies
with limited liability. The Rollover Shareholders collectively beneficially
own approximately 56.9% of the outstanding ordinary shares of the Company
(excluding 1,392,000 ordinary shares owned by McGraw-Hill that will be cashed
out at the effective time of the Merger and outstanding options and RSUs of
the Company). Immediately after the completion of the Merger, Holdings will be
beneficially owned by the Rollover Shareholders. Holdings and Merger Sub
intend to fund the Merger consideration through proceeds from a committed loan
facility from China Merchants Bank Co. Ltd., Hong Kong Branch.

The Company's board of directors, acting upon the unanimous recommendation of
the independent committee ("Independent Committee") formed by the board of
directors, approved the Merger Agreement and the Merger and resolved to
recommend that the Company's shareholders vote to authorize and approve the
Merger Agreement and the Merger. The Independent Committee, which is composed
solely of directors of the Company who are unaffiliated with any of Holdings,
Merger Sub, the Rollover Shareholders or any of the management members of the
Company, exclusively negotiated the terms of the Merger Agreement with the
assistance of its financial and legal advisors.

The Merger, which is currently expected to close during the first or second
quarter of 2014, is subject to customary closing conditions as well as the
approval by an affirmative vote of (i) shareholders representing two-thirds or
more of the ordinary shares present and voting in person or by proxy as a
single class at the extraordinary general meeting, and (ii) shareholders
(other than the Rollover Shareholders) representing a majority of the
outstanding ordinary shares (excluding the ordinary shares held by the
Rollover Shareholders) present and voting in person or by proxy as a single
class at the extraordinary general meeting. 

Concurrently with the execution of the Merger Agreement, the Rollover
Shareholders have entered into a voting agreement with Holdings and the
Company whereby they have agreed, among other things, to vote in favor of
approval of the Merger Agreement and Merger. This represents voting
commitments from shareholders beneficially owning approximately 61.6% of the
Company's outstanding ordinary shares (excluding outstanding options and RSUs
of the Company). If completed, the Merger will result in the Company becoming
a privately-held company and its ADSs will no longer be listed on the NASDAQ.

HoulihanLokey (China) Limited is serving as financial advisor to the
Independent Committee. Ropes & Gray LLP is serving as U.S. legal advisor to
the Independent Committee and Maples and Calder is serving as Cayman Islands
legal advisor to the Independent Committee.

Loeb & Loeb LLP is serving as U.S. legal advisor to the Rollover Shareholders
and the Company. Walkers is serving as Cayman Islands legal advisor to the
Rollover Shareholders. 

Additional Information about the Transaction

The Company will furnish to the Securities and Exchange Commission (the "SEC")
a report on Form 6-K regarding the proposed transactions described in this
announcement, which will include the Merger Agreement related to the Merger.
All parties desiring details regarding the Merger are urged to review these
documents, which will be available at the SEC's website (http://www.sec.gov).

In connection with the Merger, the Company will prepare and mail a proxy
statement to its shareholders. In addition, certain participants in the Merger
will prepare and mail to the Company's shareholders a Schedule 13E-3
transaction statement. These documents will be filed with or furnished to the
SEC. INVESTORS AND SHAREHOLDERS ARE URGED TO READ CAREFULLY AND IN THEIR
ENTIRETY THESE MATERIALS AND OTHER MATERIALS FILED WITH OR FURNISHED TO THE
SEC WHEN THEY BECOME AVAILABLE, AS THEY WILL CONTAIN IMPORTANT INFORMATION
ABOUT THE COMPANY, THE TRANSACTION AND RELATED MATTERS. In addition to
receiving the proxy statement and Schedule 13E-3 transaction statement by
mail, shareholders also will be able to obtain these documents, as well as
other filings containing information about the Company, the Merger and related
matters, without charge, from the SEC's website (http://www.sec.gov) or at the
SEC's public reference room at 100 F Street, NE, Room 1580, Washington, D.C.
20549. In addition, these documents can be obtained, without charge, by
contacting the Company at the following address and/or phone number:

ChinaEdu Corporation
4th Floor-A, GeHua Building,
QinglongHutong No 1, Dongcheng District
Beijing 100007, People's Republic of China
Phone: +86 10 8418-7301

The Company and certain of its directors, executive officers and other members
of management and employees may, under SEC rules, be deemed to be
"participants" in the solicitation of proxies from our shareholders with
respect to the transaction. Information regarding the persons who may be
considered "participants" in the solicitation of proxies will be set forth in
the proxy statement and Schedule 13E-3 transaction statement relating to the
transaction when it is filed with the SEC. Information regarding certain of
these persons and their beneficial ownership of the Company's ordinary shares
is also set forth in the Company's Form 20-F, which was filed with the SEC on
April 25, 2013. Additional information regarding the interests of such
potential participants will be included in the proxy statement and Schedule
13E-3 transaction statement and the other relevant documents filed with the
SEC when they become available.

This announcement is neither a solicitation of proxy, an offer to purchase nor
a solicitation of an offer to sell any securities and it is not a substitute
for any proxy statement or other filings that may be made with the SEC should
the transaction proceed.

About ChinaEdu Corporation

ChinaEdu Corporation is an educational services provider in China,
incorporated as an exempted limited liability company in the Cayman Islands.
Established in 1999, the Company's primary business is to provide
comprehensive services to the online degree programs of leading Chinese
universities. These services include academic program development, technology
services, enrollment marketing, student support services and finance
operations. The Company's other lines of businesses include the operation of
private primary and secondary schools, online interactive tutoring services
and providing marketing, support for international and elite curriculum
programs and online learning community for adult students.

The Company believes it is the largest service provider to online degree
programs in China in terms of the number of higher education institutions that
are served and the number of student enrollments supported. The Company
currently has entered into collaborative alliances with 13 universities,
ranging from 15 to 50 years in length. The Company has also entered into
technology agreements with 8 universities. Besides, ChinaEdu performs
recruiting services for 23 universities through a nationwide learning center
network.

Safe Harbor: Forward-Looking Statements

Certain statements contained in this announcement may be viewed as
"forward-looking statements" within the meaning of Section 27A of the U.S.
Securities Act of 1933, as amended, and Section 21E of the U.S. Securities
Exchange Act of 1934, as amended, and as defined in the U.S. Private
Securities Litigation Reform Act of 1995. These forward-looking statements can
be identified by terminology such as "if," "will," "expected," and similar
statements. Forward-looking statements involve inherent risks, uncertainties
and assumptions. Risks, uncertainties and assumptions include: uncertainties
as to how the Company's shareholders will vote at the meeting of shareholders;
the possibility that competing offers will be made; the possibility that debt
financing may not be available; the possibility that various closing
conditions for the transaction may not be satisfied or waived; and other risks
and uncertainties discussed in documents filed with the SEC by the Company, as
well as the Schedule 13E-3 transaction statement and the proxy statement to be
filed by the Company. These forward-looking statements reflect the Company's
expectations as of the date of this press release. You should not rely upon
these forward-looking statements as predictions of future events. The Company
undertakes no ongoing obligation, other than that imposed by law, to update
these statements.

For further information, please contact:

Helen Plummer
Senior Investor Relations Coordinator
ChinaEdu Corporation
Phone: +1 908-442-9395
E-mail: helen@chinaedu.net

Simon Mei
Chief Financial Officer
ChinaEdu Corporation
Phone: +86 10 8418-7301
E-mail: simon@chinaedu.net

SOURCE ChinaEdu Corporation
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