Raffles Education seeks shareholder nod for dual sale of China asset, Merchant Road property
Two extraordinary general meetings will be held on Feb 3; share price jumps 19.3%
[SINGAPORE] Raffles Education is seeking shareholder approval for the disposals of its college asset in China for 426.4 million yuan (S$75.9 million) and a Merchant Road property for S$121.8 million.
Following the news, the company’s shares jumped 19.3 per cent to S$0.179 at 1.54 pm on Monday (Jan 19).
The mainboard-listed company noted that the sales constitute “major transactions” and are conditional upon shareholder approval.
Hence, it will convene an extraordinary general meeting (EGM) on Feb 3 at 10 am for the sale of the Merchant Road building, and a separate EGM on the same day at 11 am for the sale of the China asset.
In October 2025, the company announced plans to convert some S$15.53 million in outstanding debt due to its chairman and chief executive officer Chew Hua Seng into new ordinary shares. It also proposed a special interim dividend of S$0.004 per share for all shareholders.
Anhui province college sale
The proposed sale of Hefei Yuren Education Management, a China-incorporated company that owns a private vocational college in the Anhui province, was announced in November.
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Hefei Yuren Education Management’s business operations involve the promotion of the college, Wanbo Science and Technology Vocational College.
Three of Raffles Education’s wholly owned indirect subsidiaries in China had entered a sale and purchase agreement to sell their entire stakes in Hefei Yuren Education Management to Hefei Heyi Education Consulting Management, an independent third party.
The three subsidiaries, Foodbev (Shanghai), Raffles Lasalle Education Consultancy (Shanghai) and Shanghai Shangxin Commercial Consulting, own 90 per cent, 9 per cent and 1 per cent of Hefei Yuren Education Management, respectively.
The company said on Monday that the proposed disposal will significantly enhance its long-term financial position.
The deal will strengthen the group’s balance sheet by eliminating 314.4 million yuan of intra-group liabilities and significantly reduce its leverage.
Net cash inflow from the disposal will provide funds to repay external borrowings and to support working capital for the group’s other core education operations, the company said.
Should the proposed sale take place, Raffles Education noted that it will still have operations and schools in China, specifically in cities such as Guangzhou, Shanghai and Suzhou.
The 426.4 million yuan consideration for the proposed sale comprises an immediate cash component of 112 million yuan and the assumption of liabilities, which together were deemed to offer “optimal value and risk allocation”, said Raffles Education.
The consideration was based on several factors, including the assumption that sellers’ liabilities stood at 314.4 million yuan.
This price also reflects the outcome of arms length negotiations, accounting for the future cash flow prospects of the college alongside the structure of deferred payments and prevailing market conditions for private vocational education colleges in Anhui province.
Assuming the disposal was completed on Jun 30, 2025, Raffles Education’s net tangible asset per share would be S$0.3687 after the deal, down from S$0.3915 before the deal.
Assuming the transaction was completed on Jul 1, 2024, the group would record a loss per share of S$0.0183 post-sale, compared to an earnings per share of S$0.0055 pre-sale.
Merchant Road property sale
The proposed sale of the 51 Merchant Road property, known as Raffles Education Square, to a joint venture between Elevate Capital and LaSalle Investment Management was announced on Dec 1, 2025.
It is expected to yield a S$53 million gain on disposal alongside net proceeds of around S$121.3 million.
The company said in December that the deal would optimise its balance sheet and capital structure as well as facilitate clearance of the property’s associated loan, to eliminate a “significant liability and its related interest burden”.
Proceeds from the sale will be used to improve working capital and fund higher-yielding initiatives, the company added then.
Shares of Raffles Education closed Friday 6.4 per cent or S$0.009 higher at S$0.15.
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