According to news on November 22, Oriental Selection issued an announcement that the company’s board of directors approved the sale, that is, it proposed to sell the education business to its parent company New Oriental. Since then, Oriental Selection has ceased to operate in the field of online education and has become a self-operated product and live broadcast business operator.
The sale is part of Guangdong New Oriental Group's business restructuring to more clearly demarcate its business lines and better align its business units with the operating environment.
The sale includes all equity interests in the education businesses operated by Oriental Selection: Youbo Hong Kong, Kuxuehuisi and Xi'an Ruiying, as well as related intellectual property assets, business contract rights and responsibilities, accounts receivable and payables, inventories, other related assets and employment resources related to the education business and affiliated with the "University Education" and "Institutional Clients" business divisions of the Oriental Selection Group.
After the completion of the sale, the industries operated by Oriental Selection and New Oriental Group will be differentiated and different from each other. Oriental Selection will no longer operate in the field of online education, but will become a specialized self-operated product and live broadcast business operator.
According to the announcement, the total consideration for the sale of Oriental Selection’s education business was RMB 1.5 billion, paid in cash.
The announcement shows that in the 2023 fiscal year ending on May 31, 2023, the net profit before tax of Oriental Selection’s education business was 117.6 million yuan, and the net profit after tax was 121 million yuan; as of September 30, 2023, the book value (net debt) of Oriental Selection’s education business was approximately 153.1 million yuan. Oriental Selection is currently expected to record proceeds from the disposal of approximately NT$1.6531 billion.