China's TAL Education Rallies After $120 Million U.S. Initial Public Offer

TAL Education Group, which offers after-school tutoring services in China, raised $120 million after pricing its initial public offering at the top of its forecast range. The shares rallied 50 percent.

The Beijing-based company sold 12 million American depositary receipts for $10 each yesterday after offering them at $8 to $10 apiece, according to a filing with the Securities and Exchange Commission and a statement. TAL Education climbed $5 to $15 today in New York Stock Exchange trading.

The sale came after companies from China posted three of the four biggest gains among U.S. IPOs in 2010 while Ambow Education Holding Ltd. and Global Education & Technology Group Ltd., two Beijing-based test preparation providers, listed their shares in New York this year. TAL Education’s sales increased 86 percent in the year ended in February, the filing showed.

“They have quite a growth ahead of them that they can execute,” said Benjamin Kirby, a Santa Fe, New Mexico-based analyst at Thornburg Investment Management, which has about $65 billion in assets. “They have volume growth, they have geographic expansion opportunities.”

TAL Education, which provides its services to more than 380,000 students in cities from Beijing to Wuhan, will use the proceeds to help increase its number of learning and service centers and pay a dividend, according to the prospectus.

This Week’s IPOs

Credit Suisse Group AG of Zurich and Morgan Stanley in New York led the offering. The IPO was the third of six scheduled for this week, according to data compiled by Bloomberg.

Bravo Brio Restaurant Group Inc., the Columbus, Ohio-based Italian restaurant chain operator, will sell 8.3 million shares at $14 to $16 each today. Vera Bradley Inc., the Fort Wayne, Indiana-based women’s accessory retailer, will offer 11 million shares at $14 to $16 each, data compiled by Bloomberg show.

Aegerion Pharmaceuticals Inc., the Bridgewater, New Jersey- based biopharmaceutical company that develops drugs treating lipid disorders, will sell 4.7 million at $14 to $16 tomorrow, SEC filings and data compiled by Bloomberg show.

Chinese companies account for six of the 10 biggest gains among U.S. IPOs this year, led by Shandong province-based China New Borun Corp.’s 169 percent surge, data compiled by Bloomberg show. China’s economy will grow 9.6 percent in 2011, according to estimates from the Washington-based International Monetary Fund. That compares with 2.2 percent for developed nations and 2.3 percent forecast for the U.S.

Not all offerings from Chinese companies have rallied. ShangPharma Corp., a Shanghai-based pharmaceutical company, slid 15 percent yesterday for the biggest first-day decline for any U.S. IPO this year, data compiled by Bloomberg show.

To contact the reporter on this story: Cecile Vannucci in New York at cvannucci1@bloomberg.net.

To contact the editor responsible for this story: Daniel Hauck at dhauck1@bloomberg.net.

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