Raffles Education seeks shareholder nod on RMB426.4 million sale of private college in China

[SINGAPORE] Raffles Education is seeking shareholder approval for the proposed sale of its China asset for 426.4 million yuan (S$75.9 million) via an extraordinary general meeting (EGM).

The proposed disposal is in the company’s best interest, as it is a “strategic initiative” that will significantly enhance its long-term financial position, said Raffles Education on Monday (Jan 19). The company added that the transaction will eliminate 314.4 million yuan of intra-group liabilities and significantly reduce its leverage.

As the proposed transaction constitutes a “major transaction”, it is conditional upon shareholder approval, said the mainboard-listed company in a bourse filing on Monday (Jan 19). Thus, an EGM will be convened on Feb 3 at 11 am to settle the matter.

The proposed sale was announced on Nov 19. On that day, three of the company’s wholly owned indirect subsidiaries in China inked a non-binding memorandum of understanding for the sale of their entire interest in Hefei Yuren Education Management to Hefei Heyi Education Consulting Management.

The three subsidiaries are Foodbev (Shanghai), Raffles Lasalle Education Consultancy (Shanghai) and Shanghai Shangxin Commercial Consulting.

Hefei Yuren Education Management is a China-incorporated company based in the Anhui province. Its business operations involve the promotion of a private vocational college, the Wanbo Science and Technology Vocational College in Anhui.

The three Raffles Education subsidiaries, Foodbev (Shanghai), Raffles Lasalle Education Consultancy (Shanghai) and Shanghai Shangxin Commercial Consulting, own 90 per cent, 9 per cent and 1 per cent of Hefei Yuren Education Management, respectively.

Should the proposed sale take place, Raffles Education noted that it will still have operations and schools In China, spefically, in cities such as Guangzhou, Shanghai, Suzhou .

The 426.4 million yuan consideration for the proposed sale comprises an immediate cash component of 112 million yuan and the assumption of liabilities, which together were deemed to offer “optimal value and risk allocation”, said Raffles Education.

The consideration was based on several factors, including the assumption that sellers’ liabilities stood at 314.4 million yuan. This price also reflects the outcome of arms length negotiations, accounting for the future cash flow prospects of the college alongside the structure of deferred payments and prevailing market conditions for private vocational education colleges in Anhui province.

In October 2025, Raffles Education announced a plan to convert some S$15.53 million in outstanding debt due to its chairman and chief executive officer Chew Hua Seng into new ordinary shares. It also proposed a special interim dividend of S$0.004 per share for all shareholders.