Hailiang Education Group Inc. (NASDAQ:HLG), ("Hailiang Education" or the "Company" or "We"), an education and management services provider in China, today announced that it has entered into a definitive Agreement and Plan of Merger (the "Merger Agreement") with Hailiang Education International Limited, an exempted company with limited liability incorporated under the law of the Cayman Islands ("Parent") and HE Merger Sub Limited, an exempted company with limited liability incorporated under the law of the Cayman Islands and a wholly-owned subsidiary of Parent ("Merger Sub"). Pursuant to the Merger Agreement and subject to the terms and conditions thereof, Merger Sub will merge with and into the Company, with the Company continuing as the surviving company and becoming a wholly-owned subsidiary of Parent (the "Merger"), in a transaction implying an equity value of the Company of approximately US$368.89 million. Parent is ultimately controlled by Mr. Hailiang Feng ("Mr. Feng"), the founder of the Company.

Pursuant to the Merger Agreement, at the effective time of the Merger (the "Effective Time"), each ordinary share of the Company (each a "Share") issued and outstanding immediately prior to the Effective Time will be cancelled and cease to exist, in exchange for the right to receive US$0.894375 in cash without interest (the "Per Share Merger Consideration"), and each outstanding American Depositary Share of the Company (each an "ADS," representing 16 Shares, and collectively, the "ADSs") will be cancelled in exchange for the right to receive US$14.31 in cash without interest (the "Per ADS Merger Consideration"), except for (a) Shares (including Shares represented by ADSs) beneficially owned by Mr. Feng and his affiliates (the "Rollover Securityholders"), which will be rolled over in the transaction, (b) Shares (including Shares represented by ADSs) owned by Parent, Merger Sub or the Company (as treasury shares, if any) or by any of their direct or indirect subsidiaries, and (c) Shares that are held by a holder who has validly exercised and not withdrawn or lost its right to dissent from the Merger pursuant to Section 238 of the Companies Law of the Cayman Islands, which will be cancelled and cease to exist and will entitle the former holder thereof to receive payment of the fair value of such dissenting shares in accordance with Section 238 of the Companies Law of the Cayman Islands.

The Per ADS Merger Consideration represents a premium of 24.98% to the closing price of the Company's ADSs on December 22, 2021, the last trading day prior to the Company's announcement of its receipt of the "going-private" proposal from Mr. Feng, and a premium of 11.75% to the volume-weighted average closing price of the Company's ADSs during the last seven trading days prior to the Company's receipt of the "going-private" proposal.

Parent and its affiliates (the "Buyer Group"), including the Rollover Securityholders, intend to fund the Merger with a combination of rollover equity and cash, and Hailiang Group Co., Ltd. has delivered copy of an executed equity commitment letter to the Company.

The Company's board of directors (the "Board"), acting upon the unanimous recommendation of a special committee of independent directors established by the Board (the "Special Committee"), approved the Merger Agreement, the Merger and other transactions contemplated under the Merger Agreement, and resolved to recommend that the Company's shareholders vote to authorize and approve the Merger Agreement and the Merger. The Special Committee negotiated the terms of the Merger Agreement with the assistance of its financial and legal advisors.

The Merger is currently expected to close during the third quarter of 2022 and is subject to customary closing conditions, including the approval of the Merger Agreement by the affirmative vote of shareholders representing not less than two-thirds of the votes cast, present and voting in person or by proxy at a meeting of the Company's shareholders. The Rollover Securityholders have each agreed to vote and cause to be voted all of the Shares and ADSs they beneficially own, which represent approximately 87.28% of the voting rights attached to the outstanding Shares of the Company as of the date of the Merger Agreement, in favor of the authorization and approval of the Merger Agreement and the Merger. If completed, the Merger will result in the Company becoming a privately held company wholly owned by Parent and its ADSs will no longer be listed on The Nasdaq Global Market.

The Company will prepare and file with the U.S. Securities and Exchange Commission a Schedule 13E-3 transaction statement, which will include a proxy statement of the Company. The Schedule 13E-3 will include a description of the Merger Agreement and contain other important information about the Merger, the Company and the other participants in the Merger.

Kroll, LLC, operating through its Duff & Phelps Opinions Practice, is serving as the financial advisor to the Special Committee. Orrick, Herrington & Sutcliffe LLP is serving as U.S. legal counsel to the Special Committee. Hunter Taubman Fischer & Li LLC is serving as U.S. legal counsel to the Company. Conyers Dill & Pearman LLP is serving as Cayman Islands legal counsel to the Company.

VCL LAW LLP is serving as U.S. legal counsel to the Buyer Group.

Hailiang Education Enters Into Definitive Agreement For Going-Private Transaction Implying An Equity Value Of The Company Of ~$368.89M