HONG KONG, CHINA, Jan. 13, 2020 (GLOBE NEWSWIRE) -- via NEWMEDIAWIRE – UMeWorld Limited (OTC:UMEWF) announced today that it has signed a definitive agreement to acquire Proud Kids in an all-stock transaction. Based in Beijing, Proud Kids is a 1-on-4 online English language training startup catering to children aged 4-12 years old, based in lower-tiered Chinese cities. Launched in March 2018 and backed by Top Chinese VCs, Proud Kids has delivered over 150,000 paid lessons using its 1-on-4 teaching model.
Proud Kids adopts the National English Curriculum which applies to 99% of primary schools and their students. Combining the input of both a local English teacher and a native English-speaking teacher to teach students in a 1-on-4 setting, Proud Kids’ foreign teachers manage their classes and students online throughout the 120 classes annually. This generates a greater opportunity for development and improvement. The stability and consistency of these classes give parents peace of mind and the students grow to become very engaged with their teachers – all of which is imperative in the learning of a new language.
Under the terms of the agreement, Proud Kids’ shareholders will receive up to twenty-five percent (25%) of the common stock of UMeWorld Limited, on a diluted basis. In addition, UMeWorld’s Board of Directors will appoint Mr. Haining Zhang, the founder and CEO of Proud Kids, as the Company’s President & COO and a member of UMeWorld’s Board of Directors. In this role, Mr. Zhang will work closely with UMeWorld’s Chairman and CEO Mr. Michael Lee to oversee the business and operation of the Company.
Proud Kids generated RMB 2.36 million (USD 0.34 million) in revenue for the year ended December 31, 2018, and is expected to generate RMB 7.15 million (USD 1.03 million) for the year ended December 31, 2019, representing over 203% year-over-year growth. The acquisition is expected to close in April 2020, subject to customary closing conditions, including approval by UMeWorld’s stockholders and completion of Proud Kids’ audited financial statements.
“China is a country where education-focused parents spend on average more than 30 percent of household income on education, and where 84 percent of families spend money on after-school tutoring,” said Michael Lee, CEO of UMeWorld Limited. “Through this initiative, UMeWorld will enter the large and rapidly expanding English language training market for kids in China with a unique and proven product. This expansion into the English language training market is consistent with the Company’s growth strategy of embracing and expanding cross-selling and up-selling opportunities.”
“I am thrilled to join UMeWorld as we approach this significant transformation,” said Mr. Zhang, founder of Proud Kids and a TESOL certified English teacher from Arizona State University. “This is an extraordinary opportunity for Proud Kids to expand its product offering to China Mobile’s users. I look forward to working with the leadership team here at UMeWorld during this next phase of Proud Kids’ development.”
China's Junior English language training market size represents more than RMB 100 billion (USD 144 Billion). Competitions on children's English training in China are fierce and they have been lying heavily in Tier-One cities. Many 1-on-1 players are being challenged for not being financially profitable and for over-applying contents from abroad in teaching. Proud Kids places its focus on the lower-tiered blue ocean which represents a much bigger market with more practical and affordable English training needs. Proud Kids believes that language learning should always be community-based. The gap in knowledge allows students to exchange information in class with each other which in turn creates opportunities to practice the language learned in class. The 1-on-4 teaching model allows individual to individual communication, individual to group communication and group to group communication. Furthermore, 1-on-4's lesson income is far greater than 1-on-1.
About UMeWorld
We are an educational technology company and a visionary player in the online educational landscape in China. UMFun, our K-12 flagship product, is a cloud-based assessment and learning analytics platform that can intelligently analyze and adapt to a student's performance and personalizes the delivery of proprietary educational items in accordance with their individual learning needs. UMFun is made available to Chinese K-12 students through China Mobile, the world's largest mobile service provider by network scale and subscriber base, serving over 887 million customers. Working with China Mobile, we are levelling the educational playing field by providing affordable and quality education to millions Chinese K-12 students in China.
About Proud Kids
Founded in December 2017, Proud Kids is a leading online English education platform in China. We connect native English-speaking tutors from the UK, North America and South Africa and young learners between 4-12 years old in China. We partner local English teachers with native English-speaking tutors. With our own interactive curriculum that aligns with China's English education curriculum, teachers teach on a 1-on-4 small class model, guiding students through fun and dynamic learning experiences. We are poised to build lasting growth across the world.
Forward-Looking Statements
This communication contains “forward-looking” statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, that involve risks and uncertainties. In some cases, you can identify these forward-looking statements by the use of terms such as “expect,” “will,” “continue,” or similar expressions, and variations or negatives of these words, but the absence of these words does not mean that a statement is not forward-looking. All statements other than statements of historical fact are statements that could be deemed forward-looking statements, including, but not limited to: any statements regarding the expected timing of the completion of the transaction; the ability of UMeWorld and Proud Kids to complete the proposed transaction considering the various conditions to the transaction, some of which are outside the parties’ control, including those conditions related to regulatory approvals; the expected benefits and costs of the proposed transaction; any statements concerning the expected development or competitive performance relating to Proud Kids’ products and services; any statements regarding UMeWorld’s future intention with Proud Kids; any other statements of expectation or belief; and any statements of assumptions underlying any of the foregoing. A number of important factors and uncertainties could cause actual results or events to differ materially from those described in these forward-looking statements, including without limitation: the failure to satisfy any of the conditions to the consummation of the proposed transaction, including the adoption of the Acquisition Agreement by UMeWorld’s stockholders and the receipt of certain governmental and regulatory approvals; the occurrence of any event, change or other circumstance that could give rise to the termination of the Acquisition Agreement; unexpected costs, charges or expenses resulting from the proposed transaction. UMeWorld assumes no obligation to update the information in this communication, except as otherwise required by law. Readers are cautioned not to place undue reliance on these forward-looking statements that speak only as of the date hereof.
CONTACT: For more information, please contact: Ruby Hui, Executive Vice President UMeWorld Limited E-mail: info@umeworld.com Telephone: 86 20 2231 9506