Source: unsplash

A-share listed company Vtron shares announced recently that it will sell 70% stake in Keer Education for 303.4 million yuan due to the uncertainty caused by the new policy in terms of the early childhood education industry in China.

Keer Education was established on December 8, 2009, focusing on the management of kindergarten franchisee. In August 2017, Vetron purchased 70% of its equity by cash, with a transaction consideration of 385 million yuan.

On October 30 this year, Vetron released its 2019 Q3 report, showing that from the beginning of 2019 to the end of the third quarter, the company achieved income of 796 million yuan with a year-on-year decrease of 3.52%, and the net profit attributable to shareholders was 90 million yuan with a year-on-year decrease of 38.61%.

* On November 15 2018, the State Council pointed out that private kindergartens are prohibited to be listed whether separately or as a whole part of assets. In this context, listed companies are not allowed to seek funding and issue shares through stock market any longer, or to purchase the assets of for-profit kindergartens by cash injection via equity market.