BEIJING, Dec. 8, 2016 /PRNewswire/ -- China Distance
Education Holdings Limited (NYSE: DL) ("CDEL", or the "Company"), a
leading provider of online education in China focusing on professional education,
today announced that its majority-owned subsidiary Beijing Zhengbao
Yucai Education Technology Co., Ltd. ("Zhengbao Yucai") has
delivered a revised share issuance plan ("Revised Plan") to
China's New Third Board, an
over-the-counter stock exchange. Under the Revised Plan, Zhengbao
Yucai will issue no more than 41,880,000 common shares,
representing 40.5% of the total outstanding shares of Zhengbao
Yucai immediately after the share issuance, at a price of
RMB1.99 ($0.28) per common share, an increase from
RMB1.91 per common share proposed
under the prior plan. Total funds raised by the share issuance are
expected to be no more than RMB83.3
million ($11.9 million), an
increase from RMB80.0 million
proposed under the prior plan. The proceeds from this share
issuance are expected to be used by Zhengbao Yucai for business
development, which includes mergers or acquisitions of
complementary businesses focused on China's college market.
Pursuant to the Revised Plan, Mr. Zhengdong Zhu, chairman and CEO of CDEL, and Mr.
Liankui Hu, an independent director of CDEL, will subscribe for
63.8% and 24.6%, respectively, of the total shares to be issued.
Immediately following the share issuance, the equity interest of
CDEL in Zhengbao Yucai will be reduced from 60.1% to 35.8%, and
Mr. Zhu, Mr. Hu, and a partnership in which Mr. Zhu
holds a majority of the equity interests will collectively have a
combined equity interest in Zhengbao Yucai of 59.5%.
Mr. Zhu, Mr. Hu, and the partnership have entered into
an acting-in-concert agreement with a wholly-owned subsidiary of
the Company through which CDEL holds its shares in Zhengbao Yucai,
requiring them to vote their shares as to key matters put before
the shareholders in accordance with the instructions of such
subsidiary.
In the course of discussions concerning the proposal to cause
Zhengbao Yucai to raise capital from Mr. Zhu and Mr. Hu,
the Board determined that, in view of the Company's equity interest
in Zhengbao Yucai and Mr. Zhu's and Mr. Hu's positions
with the Company, Mr. Zhu's and Mr. Hu's involvement
would cause the transaction to be a related-party transaction for
the Company. Accordingly, the Board (i) appointed a
special committee of the Board composed solely of independent
directors (the "Special Committee") to evaluate and negotiate the
key terms of the proposed transaction and (ii) authorized the
Special Committee to retain legal counsel and a financial advisor
to advise the Special Committee on the proposed transaction and
assist it with the negotiation of the key terms of the proposed
transaction. The Board asked the Special Committee to consider the
fairness to the Company and its shareholders of the terms of the
proposed transaction and to recommend to the full Board whether or
not it should approve the proposed transaction. The Special
Committee, relying in part on an evaluation report from the
financial advisor to the Special Committee, negotiated with
Mr. Zhu and Mr. Hu as to the key terms of the transaction
and determined that the terms of the Revised Plan were fair to the
Company, and recommended that the Board approve the Revised Plan
and the related acting-in-concert agreement. The Board,
relying on the Special Committee's recommendation, determined that
the terms of the proposed transaction were fair to the Company and
its shareholders, and approved the Revised Plan and the related
acting-in-concert agreement and authorized the Company to cause the
board of directors of Zhengbao Yucai to approve the Revised
Plan.
Zhengbao Yucai was listed on the New Third Board in an effort to
enhance its brand and visibility within the China market, which the Company hopes may
offer Zhengbao Yucai the opportunity to raise capital from the
Chinese capital markets to fund future growth. In addition, the
Company believes that Zhengbao Yucai's New Third Board listing and
the Revised Plan will enable CDEL to focus primarily on its core
professional education businesses, while Zhengbao Yucai focuses on
college education opportunities.
Safe Harbor Statement
This announcement contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended,
and as defined in the U.S. Private Securities Litigation Reform Act
of 1995. Forward-looking statements are not historical facts, but
instead are predictions about future events. Future events are
inherently uncertain, and our forward-looking statements may turn
out to be incorrect. The Company and Zhengbao Yucai may not realize
the anticipated benefits of the listing of Zhengbao Yucai's shares
and Zhengbao Yucai's Revised Plan. The forward-looking statements
in this press release speak only as of the date on which they are
made, and we assume no obligation to update any forward-looking
statements except as required by law.
About China Distance Education Holdings Limited
China Distance Education Holdings Limited is a leading provider
of online education in China
focusing on professional education. The courses offered by the
Company through its websites are designed to help professionals
seeking to obtain and maintain professional licenses and to enhance
their job skills through our professional development courses in
China in the areas of accounting,
healthcare, engineering & construction, and other industries.
The Company also offers other professional education courses for
the national judicial examination, online test preparation courses
for self-taught learners pursuing higher education diplomas or
degrees, test preparation courses for university students intending
to take the nationwide graduate school entrance exam, and online
language courses. We also offer third-party developed online
courses through our Online Open Learning Platform, a proprietary
education platform that allows people to share their educational
content or deliver live courses online. For further information,
please visit http://ir.cdeledu.com.
Contacts:
China Distance
Education Holdings Limited
|
The Piacente Group |
Investor Relations
|
Investor Relations
Department
|
Brandi
Piacente
|
Tel: +86-10-8231-9999
ext 1805
|
Tel: +1
212-481-2050
|
Email:
IR@cdeledu.com
|
Email:
dl@tpg-ir.com
|
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SOURCE China Distance Education Holdings Limited