Chinacast Education Corporation
ChinaCast Education Corporation is a leading for-profit, post-secondary education and e-learning services provider in China. The Company provides its post-secondary degree programs through its 80% ownership in the holding company of the Foreign Trade and Business College (FTBC) of Chongqing Normal University. FTBC offers career-oriented bachelor's degree and diploma programs in business, economics, trade, tourism management, advertising, language, IT and music fully accredited by the PRC Ministry of Education.
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Chinacast receives US$19.9m investment from former shareholders in its Chongqing business school
ChinaCast Education Corporation (Nasdaq:CAST), today announced the closing of a US$19.9m direct investment with the former minority shareholders of The Foreign Trade and Business College of Chongqing Normal University (FTBC). The transaction is expected to be accretive to 2009 financial results.
The Company issued 2.6 million shares of restricted stock at US$7.6524 per share, a 20 percent premium to the twenty day volume weighted average share price for the period ending September 14, 2009. The shares are subject to a six month lock-up.
On April 21, 2008, ChinaCast Education Corporation completed the acquisition of 80 percent of FTBC. On August 11, 2009, it completed the purchase of the remaining 20 percent from the minority shareholders for US$19.9m in an all cash transaction. Subsequently, the former minority shareholders of FTBC proposed to invest the entire cash proceeds from that sale back into restricted common shares of ChinaCast Education Corporation.
"We greatly value our relationship with these strategic shareholders as they represent a distinguished group of high level, experienced investors in the post-secondary education sector in China," said Ron Chan, ChinaCast Chairman and CEO. "This transaction also provides ChinaCast with an additional $20 million to utilize for working capital and incremental growth opportunities."
