Recent years have seen an IPO and acquisition boom in the Private Education Industry. Chinese private education companies are rushing to list abroad, with over 10 IPOs in 2017 and 2018. One example is Wisdom Education, an operator of schools in Southern China, which listed on the Hong Kong Stock Exchange (“HKEx”) in 2017. Another example is Chinese after-school math education provider, Four Seasons Education, which made its debut on the New York Stock Exchange in November 2018.
The expansion frenzy is not limited to China-based education companies. Early childhood educator, MindChamps, started trading on the Singapore bourse in November 2017. Following its listing debut, MindChamps acquired four preschools in Australia. In 2018, Kingsley EduGroup, the first Malaysian education service provider to be listed on the Growth Enterprise Market (“GEM”) of HKEx, announced plans to set up its schools across Asia. And there are more expansion plans in the pipeline.
Private education has emerged as a promising and attractive industry, buoyed by parents’ willingness to spend on private schooling and enrichment programmes for their children. In many parts of Asia, investing in children’s education is of high priority to parents. Often perceived to be a better alternative to the national education, private education is well sought after and within reach, in view of a growing middle class and economic growth in the Asia.
In some emerging countries, the desire of parents to enrol their children for overseas education is strong. In particular, enrolling into a well-known international school or studying in a foreign country with many ranked universities is perceived to be esteemed. Parents are also increasingly aware that the mastery of an international language would help their children open up potential career opportunities. This has bolstered the demand for education in the English medium, and has, thus resulted in the expansion of the international school market.
Regulatory policies could either drive the demand or slowdown the development of the Private Education Industry. For instance, the removal of restrictions on the number of Vietnamese students that can enrol in international schools has created opportunities. The Private Education Industry, however, is not without drawbacks. Recently, China has reined in on kindergartens raising funds in the global markets.
Despite the challenges, demand for private education is apparent and is not likely to decrease anytime soon.