Benzinga | Jul 19, 2021 12:33PM EDT

China Liberal Education Shares Fall After Extending LOI To Acquire Wanzhong For $53.9M

* China Liberal Education Holdings Ltd (NASDAQ:CLEU) has extended its non-binding letter of intent (LOI) to acquire Wanzhong (Hong Kong) Education Investment Management Co Ltd.

* The company intends to acquire 100% of the issued and outstanding shares of Wanzhong from its sole shareholder, to be paid in cash and ordinary shares with a total value of $53.9 million (1$ = 6.49 CNY as of July 19).

* China Liberal signed the LOI on December 28, 2020 with the sole shareholder of Wanzhong.

* Wanzhong operates an independent three-year college and a four-year college.

* The total assets of these two colleges are about $30.7 million. With more than 4,000 students currently enrolled, these two colleges generate annual revenue of about $15.3 million in the aggregate.

* China Liberal's cash and equivalents totaled $5.01 million as of December 31, 2020.

* "Through this acquisition, we would directly operate the schools as the owner, which is a challenge but also a huge opportunity for us," said CEO Ngai Ngai Lam.

* Price action: CLEU shares are trading lower by 7.87% at $2.19 on the last check Monday.