China Oriental Culture Diversified into Online Education Service to Expand Income Sources

Posted: September 10, 2012 at 4:15 am


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HONG KONG, Sept. 10, 2012 /PRNewswire/ -- China Oriental Culture Group Limited (the "Company" or "China Oriental Culture", stock code:2371), is pleased to announce that the Purchaser, a wholly owned subsidiary of the Company, entered into an acquisition agreement with Headwind Holdings Limited (the "Vendor") and Mr. Lu Xing (the "Guarantor") to conditionally agree to acquire Housden Holdings Limited (the "Target", together with its subsidiaries, the "Target Group") on 7 September 2012 (the "Acquisition Agreement").

According to the Acquisition Agreement, the initial consideration for the acquisition of HK$199.5 million will be satisfied by the Company issuing 950,000,000 preferred shares of the Company (the "Initial Preferred Shares") at the issue price of HK$0.21 per preferred share and if the consolidated net profit after taxation of during a profit warranty period stipulated under the Acquisition Agreement reaches RMB40,000,000 and there are 1 million or more registered users of the education platform of the Target Group during such profit warranty period, the consideration for the acquisition will be adjusted upward by HK$199.5 million and 950,000,000 additional preferred shares of the Company (the "Additional Preferred Shares") at the issue price of HK$0.21 per preferred share will be issued to the Vendor in satisfaction of the increment in the consideration for the acquisition. After the Initial Preferred shares and the Additional Preferred Shares were issued in full, the total consideration so paid will be HK$399 million.

The Target Group set a strategic goal of "one-stop comprehensive online learning service", directed the major business focus to the provision of online training and education services, and exerted effort to build a management platform for online learning and services, which integrates online learning public services, intelligent management of online education, and educational resources trading, and will be capable of handling a large number of online users simultaneously. By employing software that supports online sharing mode, the platform is able to provide various training institutes and individual learners with online training management services. With the support of the platform, individual learners are able to conduct self-training and management through the database of course material of the platform. Besides, the platform can also be functioned to provide knowledge trading services for online education training, optimising and integrating course material resources and forming a market for trading those resources.

The Target Group mainly provides training services like preparation for national professional qualifications and professional qualification certificates, online language learning and cross-cultural training, online extracurricular tutoring for primary and secondary students as well as continuing education training for civil servants and professional technicians. The Target Group also offers online training and tailor-made training services to large national enterprises and social organisations. The Target Group has ranked as one of the major comprehensive online education service operators in China.

Commenting on the agreement, Mr. Li Qing, Executive Director of the Company, said: "We are very pleased to have signed the agreement and diversify our business into the online education service market. With the society progressing and continuous advancing of information technology, we have confidence in the prospect of the said business in China. The acquisition is a milestone of the Companys development and will further expand our business. Looking forward, we will look into more potential acquisition projects and further increase our income sources."

About China Oriental Culture Group Limited

The Group is principally engaged in (i) the provision of advertising and consultancy services in respect of placing advertisements on the outdoor billboards and LED screens of the Group to advertisers and advertising agencies.

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China Oriental Culture Diversified into Online Education Service to Expand Income Sources

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September 10th, 2012 at 4:15 am

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