The publicly traded education firm ATA Inc. has solidified an agreement to acquire ACG, a firm which provides opportunities for Chinese students interested in the study of art.
In a process began in April, ATA is announcing this acquisition this morning, and as a result, its price went up from a previous close of $2.60 around $3.10 in premarket trading.
Parties expect the deal to be finalized before August.
ATA, which is traded on the NASDAQ exchange, will clear details with the US Securities and Exchange Commission.
As a global study firm, ACG has 23 campuses in 21 Chinese cities, and provides a range of services for students wanting to broaden their horizons beyond the Middle Kingdom, with many of them setting their sights on U.S. schools.
“We are thrilled to be partnering with ATA given its sterling reputation as a leading service provider in education and learning technologies in China,” ACG founder Jun Zhang said in a press statement. “Over the past several years, we have focused on building an education system especially for students and young professionals interested in art and other creative fields, and we believe ATA is the partner we need to take ACG’s growth to the next level and will enable us to better serve our student population as we work to expand our offerings and supporting services.”
For ATA, it’s all about industry expansion.
“We are pleased to have this opportunity to partner with the ACG team and look forward to working closely with its management on growing the business and pursuing prospects for expansion and diversification by leveraging ATA’s expertise in learning technologies and industry relationships, as well as the synergies created by our respective offerings, operational capabilities, resources and competencies,” Mr. Kevin Ma, ATA’s Chairman and CEO, told reporters. “Chinese students continue to represent the largest population of students studying abroad …With the continued growth in this industry, we believe our partnership with ACG will enable ACG to strengthen its leadership position within the industry and accelerate the growth of its business.”
Traders looking at ATAI after the bell will see that the stock has fared relatively well: though off of those pre-markets numbers a bit, ATAI still holds at around $2.90 as of mid-morning, high above the dollar mark the stock sunk to prior to Thanksgiving last year. After a spike in April, ATAI cooled off, but now, it is once again on the march – which makes sense, since its value is not tied to exports.