Having already been listed in the US for 14 years, New Oriental is the largest private provider of education services in China, offering a slew of products including tutoring, test prep, language classes and online education.
Although total net revenue decreased by 8% year-on-year for the first fiscal quarter of 2021, the company also saw enrolment in academic tutoring and test preparation courses increase by 13.5% and the opening of an additional 211 schools and learning centres.
The largest declines were seen in its overseas test preparation business (51%) and overseas consulting and study tours (31%).
“New Oriental’s choice of secondary listing in Hong Kong is a strategic move that surfs on the tide of the times, having considered the company’s future development plans and other macro factors,” said Michael Minhong Yu, founder and executive director of the company during the listing ceremony.
“[This] is a strategic move that surfs on the tide of the times”
“We hope to leverage this opportunity to break new ground for New Oriental, with the aim of providing students with higher quality and more diversified educational products and services, and making greater contributions to the progress of the development of China’s education.”
Yu added that the secondary listing demonstrated the company’s confidence in the city as a “global capital and financial centre, as well as our confidence and expectation in Hong Kong’s long-term prosperity and stability”.
Large-scale protests and crackdowns on civil liberties by the authorities over the last few years have continued to stoke fears of companies and capital leaving the city and threatening its economic stability.
After deductions the company expects to receive proceeds from its Global Offering of approximately HK$9,967.7 million (£965.9 million), which will be used to invest in “technologies to enhance its students’ learning experience, its business growth and geographic expansion, strategic investments and acquisitions, and general corporate purposes and working capital needs”.
Yu further said that the listing in Hong Kong would provide “access and convenience to a broader set of investors, by creating a nearly round-the-clock market to trade our shares, and will allow more of our customers and stakeholders across Asia to invest”.