EdTechX Holdings, a London-based special purpose acquisition company (SPAC, for short), has agreed to merge with Meten Education, a Chinese company that offers English language-learning services for students and professionals.
The deal gives Meten a current valuation of $535 million. The transaction, expected to close by March 2020, will create a new entity that will operate as “Meten EdtechX,” which will have a combined value estimated at $614 million, according to the press release.
SPACs raise money directly from the public with the explicit purpose of acquiring a private company, which then becomes publicly held (through a process known as a “reverse merger.”) EdTechX listed on Nasdaq in October 2018, raising $65 million and later securing additional funds to purchase an education company. In an interview with EdSurge in January, the group’s CEO said: “We’ll use this first acquisition as a catalyst for more deals and create a platform for next-gen educational and training businesses.”
Based in Shenzhen, China, Meten operates 149 language learning centers across the country, and also offers an online tutoring platform for English learning. The company has raised more than $69 million since its founding in 2006, the most recent of which came in a $43 million Series C round in January 2019. According to the announcement, Meten reported $200 million in revenue and $20.1 million in EBITDA in 2018.
