On April 23, China Online Education Group (51Talk) (NYSE: COE), a leading online English education platform, announced that it has entered into a definitive agreement to acquire 100% equity interest in Beijing Xiangyue Education Technology Co., Ltd. (“Koala Reading”), a developer and provider of Chinese reading ability assessment systems and reading training systems in China, by issuing Class A ordinary shares of the Company through private placement.
The Transaction is expected to close in the first half of 2021 in accordance with customary closing conditions.
“We see clear strategic value in this acquisition,” said Mr. Jack Jiajia Huang, Founder, Chairman and CEO of 51Talk. “Leveraging Koala Reading’s expertise in reading assessment, we plan to develop an English assessment and rating system that allows us to provide more targeted course offerings to our students, deliver enhanced learning experiences and outcomes, and add graded reading content to further diversify our curriculum portfolio. In addition, this acquisition broadens our course offerings to include Chinese courses, bringing a holistic learning experience to our students. We look forward to working closely with the Koala Reading team and nurturing these new initiatives for our next phase of growth.”
Founded in 2016, Koala Reading developed a graded Chinese reading standard, the Enjoy Reading (ER) Framework, in collaboration with the Machine Learning Laboratory of Peking University. Koala Reading uses AI and machine learning technologies to assess and rate reading skills and make intelligent learning course recommendations based on each student's unique reading ability and interest. In May 2017, Koala Reading launched its award-winning online Chinese learning app. As of now, Koala Reading has more than 600 million users.
In March of 2021, 51Talk acquired AI formative English education application GKid to further improve its AI capabilities and system.
On its tenth anniversary celebration in March, Jack Huang announced to develop a competency-based English education system focusing on K-12 students. The system upgrade covers several aspects including technology, product, services, and teaching research and development. In the second half of 2021, 51Talk will launch its first formative education product matrix.