Everbright mezzanine fund backs western China education player

Founded in 2007, Hope Education has more than 100,000 students currently enrolled in its school and college programs. The company's network includes three undergraduate colleges, four vocational colleges and one technical college, as well as seven vocational schools, one elementary and secondary school, and a handful of training schools.

China Everbright's capital injection will be used to support continued growth in the business. "We plan to bring in key strategic partners, expedite the listing process, pool our resources for development, and strengthen our capability for further growth. We are committed to help develop the education industry in a whole new way, and nurture more talented people with practical skills for the nation's economic and social development," said Huiwu Wang, president of Hope Education, in a statement.

No timetable was given for bringing in new investors or for launching the IPO.

This is China Everbright's first partnership with a local education brand, and the firm said it is looking to leverage a broader push by the government to develop vocational education. This is seen as essential to the rebalancing of the country's economy towards higher value manufacturing and services.

In 2014, the government issued an action plan intended to create a modern, demand-oriented vocational education and training system by 2020. Key tenets of the plan include: having more than 80% of large and medium-sized enterprises - with state-owned enterprises a particular target - establish cooperation agreements with vocational schools and colleges; establish more private vocational colleges; allow local governments more freedom in tailoring courses to meet the needs of local companies; have vocational educational play more of a role in further education; and ensure equal treatment of vocational institutions and universities so it is easier to transfer from one to the other.

China Everbright's mezzanine fund provides structured solutions in the form of hybrid debt-plus-equity instruments. It seeks to partner with industry leaders and create investment platforms that identify acquisition targets and take the lead on deal structuring and negotiation.

Recent investments include a commitment to healthcare conglomerate Neusoft Holdings, which needed capital to scale up its interests in elderly care, education and other sectors. As with most of its deals, China Everbright has the right to convert part of its investment into equity in Neusoft Medical Systems under certain conditions.

• Tweet  
• Facebook  
• LinkedIn  
• Google plus  
• Save this article  
• Send to  

• Topics
• Greater China
• Expansion
• Mezzanine
• Education
• China Everbright
• Growth capital
• China