Khazanah Nasional Berhad (“Khazanah”) is pleased to announce that it has entered into a conditional Sale and Purchase Agreement to acquire a 10% stake in Oriental University City Limited (“OUCL”) from Raffles Education Corporation Limited (“REC”) for CNY300 million (approximately USD44 million or RM150 million). The investment will be made via Khazanah’s wholly-owned subsidiary, Rawa Investments (Cayman Islands) Ltd. (“RIL”).
OUCL, a wholly-owned subsidiary of REC, was incorporated in the Cayman Islands. REC is listed on the Main Board of the Singapore Stock Exchange and currently Asia Pacific’s largest private education group. OUCL, through its subsidiaries, owns Oriental University City (“OUC”) – a 3.31 million square metre self-contained campus located in Langfang, Hebei Province, China. This flagship project is strategically located within an hour’s drive from two of the most affluent and populous cities in China – Beijing and Tianjin, which combined population is approximately 28 million. OUC currently houses and provides education services to 16 colleges with a total student population of approximately 36,000. OUCL focuses on the vocational education segment, which is a large yet under-served education segment in China.
Khazanah’s Managing Director, Tan Sri Dato’ Azman Hj. Mokhtar said: “This investment is part of our China and education services strategy; it gives us exposure into the exponential growth potential of China’s education services sector. As China continues to lead the world in economic recovery and growth, there will be increased demand for skilled workforce every year. The investment allows us to capitalize on this by tapping into China’s higher education business which sees 26 million new students and is worth USD39 billion annually.
“In this regard, we are pleased to partner REC, which has a proven track record in the vocational education segment in other countries in Asia Pacific including China and Singapore,” he added.
Upon completion of this transaction, REC and Khazanah intend to list OUC by 31st August 2013 to realise its value. Khazanah and REC are also actively exploring the viability of replicating such University City business model in Malaysia and other countries regionally.
