PE-backed Ambow in $138m IPO push

Beijing's Ambow education has filed for a listing on the New York Stock Exchange. Other shareholders in the company include Macquarie and Avenue Capital.

Ambow Education, a Beijing-based operator of learning centres which counts private equity investors JAFCO Asia and Actis as shareholders, has filed for a $138 million initial public offering (IPO) on the New York Stock Exchange (NYSE), Le Wenyong director at JAFCO confirmed to PEI Asia
The company raised $54 million from investors including Avenue Capital and Macquarie Group in October 2007. Actis first invested in Ambow in 2008 alongside returning investors Macquarie Group and Avenue Capital in another round. In total, the trio invested $103 million in this round.
Ambow’s listing will mark a partial exit for pan-Asia investor JAFCO, and will provide the firm with a 10x return on its investment, according to Le. JAFCO had initially invested $4 million for a 4.2 percent stake in the company in April 2006.
It is unclear what specific shareholdings will look like following the IPO. Actis did not respond to requests for comment by press time and Avenue and Macquarie could not be reached for comment. 
Ambow was launched in 2000. Since then, it has built regional hubs in strategic provinces including Beijing, Tianjin, Henan, Shaanxi and Guangzhou. The company currently operates a network of K-12 level schools, tuition centres, independent colleges and career training centres in 30 out of 31 provinces and autonomous regions in China.
Investors have been actively looking for deals in China’s education sector as of late. According to a 2008 PEI Asia report, the country’s education market grew to an estimated $143 billion in 2007 and was predicted to expand at a compound average growth rate of 12 percent to an estimated $200 billion until the end of 2010. The government is encouraging investment in education as it seeks to build a knowledge economy and boost consumer spending, Actis told PEI Asia then.
Earlier this year, Chongqing-based private equity firm Huiou (Chongqing) Equity Investment Company launched its maiden fund focused on investments in education and education-related companies in China.
Just last month, a proposed RMB350 million (then €42.8 million; $51.2 million) offer by pan-Asian private equity firm AIF Capital to buy a 10 percent stake in Hebei-based Oriental University City from Singapore’s Raffles Education fell apart as the firm decided not to go ahead with the transaction.