Benzinga | Dec 28, 2020 04:25PM EST

TAL Education Reports $3.3B Private Placement With Silver Lake, Other Investors

TAL Education Group (NYSE:TAL) ("TAL" or the "Company"), a leading K-12 after-school tutoring services provider in China, today announced that a group of investors has agreed to invest an aggregate of $3.3 billion in the Company through private placement, of which $2.3 billion is in convertible notes (the "Convertible Notes Portion"), and $1 billion is in newly issued Class A common shares (the "Equity Portion") of the Company. Silver Lake, a global leader in technology investing, led the Convertible Notes Portion.

The transaction is subject to customary closing conditions and the closing is expected to take place in the near future. Immediately following the closing of the transaction, assuming the conversion of the entire Convertible Notes Portion into shares, the Convertible Notes Portion and the Equity Portion will account for 4.3% and 2.2% of the Company's outstanding shares, respectively. The investors have each agreed not to sell, transfer or dispose of any securities acquired in the transaction for six months after the closing. The convertible notes will bear an interest of 0.50% per annum, mature on February 1, 2026, and be convertible into American depositary shares ("ADSs") of the Company at the holder's option.

"We welcome this round of investment as an endorsement of our unwavering commitment to providing a better learning experience for the student community." said Bangxin Zhang, Chief Executive Officer of TAL.

"We are pleased to invest in TAL as China's leading EdTech platform and have strong conviction in the Company's leadership position and growth prospects in the education space," said Ken Hao, Chairman of Silver Lake.

The issuance of the securities is exempt from registration under the Securities Act of 1933, as amended (the "Securities Act") pursuant to Section 4(2) of the Securities Act regarding transactions not involving a public offering and is made in reliance on, and in compliance with, Regulation S under the Securities Act.