China Education : MAJOR TRANSACTION - ACQUISITION OF SCHOOLS IN HAINAN

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

China Education Group Holdings Limited

中 國 教 育 集 團 控 股 有 限 公 司

(incorporated in the Cayman Islands with limited liability

and carrying on business in Hong Kong as ''ChinaEdu 中教常春藤'')

(Stock Code: 839)

MAJOR TRANSACTION -

ACQUISITION OF SCHOOLS IN HAINAN

THE ACQUISITIONS

The Board is pleased to announce that on 7 August 2020 (after trading hours), the Group entered into the Sale and Purchase Agreements, pursuant to which the Group conditionally agreed to purchase, and Vendors A and Vendors B conditionally agreed to sell, an aggregate equity interests of 60% in the Target Company. In addition, the Group will enter into a management contract with the Target Company. The total consideration for the Acquisitions is RMB1,356,000,000 (equivalent to approximately HK$1,505,160,000).

IMPLICATIONS OF THE LISTING RULES

As one of the applicable percentage ratios under Rule 14.07 of the Listing Rules in respect of the Acquisitions in aggregate is more than 25% and less than 100%, the Acquisitions together constitute a major transaction of the Company under Rule 14.06 of the Listing Rules and are subject to the reporting, announcement, circular and Shareholders' approval requirements under Chapter 14 of the Listing Rules.

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GENERAL

To the best of the knowledge, information and belief of the Directors having made all reasonable enquiries, no Shareholder has a material interest in the Acquisitions. As such, no Shareholders would be required to abstain from voting in favour of the resolution approving the Acquisitions. As at the date of this announcement, the Controlling Shareholders, being a closely allied group of Shareholders, control an aggregate of 1,500,000,000 Shares, which represents approximately 74.25% of the total number of issued shares of the Company. Accordingly, pursuant to Rule 14.44 of the Listing Rules, written Shareholders' approval may be accepted in lieu of holding a general meeting of the Company to approve the terms of, and the transactions contemplated under, the Sale and Purchase Agreements upon satisfaction of the conditions set out under Rule 14.44 of the Listing Rules.

A circular (for information purposes only) containing, inter alia, further details of the Acquisitions will be despatched to the Shareholders. As it is expected that additional time will be required to prepare the relevant information to be included in the circular, the Company will apply to the Stock Exchange for an extension of time for despatch of the circular by no later than 30 October 2020.

Shareholders and potential investors should note that the Acquisitions are subject to the satisfaction and/or, where applicable, waiver of a number of conditions. As the Acquisitions may or may not proceed, Shareholders and potential investors are reminded to exercise caution when dealing in the securities of the Company.

INTRODUCTION

On 7 August 2020 (after trading hours), the Group entered into the Sale and Purchase Agreements pursuant to which the Group conditionally agreed to purchase, and Vendors A and Vendors B conditionally agreed to sell, 45% and 15% equity interests in the Target Company, respectively. In addition, the Group will enter into a management contract with the Target Company. Upon completion, the Group will own 60% equity interests in the Target Company, and the management contract will provide the Group entitlement to 100% of the operating results of the Target Company until the end of February 2023 after which the Group will continue to be entitled to the operating results of the Target Company with respect to the equity interests owned by the Group. The total consideration for the Acquisitions is RMB1,356,000,000 (equivalent to approximately HK$1,505,160,000).

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THE ACQUISITIONS

Vendors A Acquisition

Date	7 August 2020

Parties (1) Purchasers A

1. Vendors A
2. The Target Group

To the best of the Directors' knowledge, information and belief having made all reasonable enquiries, each member of Vendors A, the Target Group and their respective ultimate beneficial owners (where applicable) is a third party independent of the Company and its Connected Persons.

Assets to be acquired

Pursuant to the Vendors A Agreement, the Group conditionally agreed to purchase 45% of the equity interests of the Target Company at an aggregate consideration of RMB1,168,000,000 (equivalent to approximately HK$1,296,480,000). The transfer of equity interests are proposed as follows:

1. Vendors A shall transfer or procure the transfer of 22.5% of the equity interests of the Target Company through the transfer of NewHoldCo (which shall be a fully consolidated entity of Hainan BVI) to CEG PRC and 100% of the equity interests of Hainan BVI to CEG BVI.
2. Vendors A shall transfer 22.5% of the equity interests of the Target Company owned by Hainan Shenzheng to CEG PRC.

The consideration of the Vendors A Acquisition, payment terms and conditions

The aggregate consideration for the Vendors A Acquisition is RMB1,168,000,000 (equivalent to approximately HK$1,296,480,000). The payment shall be satisfied in the following manner:

First Payment

1. Hainan Shenzheng shall within five business days upon the signing of the Vendors A Agreement issue a payment notice to CEG PRC for the deposit of RMB150,000,000 (equivalent to approximately HK$166,500,000), the deposit shall be paid by CEG PRC in cash within seven business days upon receipt of the said payment notice.

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Second Payment

1. In respect of the Hainan BVI Transfer, CEG BVI shall transfer the equivalent of RMB535,000,000 in USD to a designated co-managed account opened in the name of CEG BVI within seven business days upon the fulfillment of the conditions including but not limited to:
2. 1. the equity transfer agreement in relation to the Hainan BVI Transfer has been entered into; and
   2. the co-managed account to be set up by CEG BVI has become operational.

For the second payment, Hainan Shenzheng shall within five business days upon the fulfillment of the conditions below issue a payment notice to CEG PRC for the consideration of RMB323,000,000 (equivalent to approximately HK$358,530,000), and Hainan Shenzheng shall issue a confirmation letter confirming the fulfillment of the conditions below.

Within seven business days upon the receipt of the confirmation letter, (i) CEG PRC shall transfer the said consideration to Vendors A's designated bank account and (ii) CEG BVI shall transfer the consideration for the Hainan BVI Transfer from the co- managed account to Vendors A's designated account. The conditions to the second payment, inter alia, are as follows:

1. the Hainan BVI Transfer and the relevant registration have been completed and the related corporate documents of Hainan BVI have been delivered to the Group;
2. the revision and amendments of the respective articles of association of the Target Company, Haikou University of Economics and Affiliated Art School of Haikou University of Economics have been completed;
3. the completion of the reorganization of the respective board of directors of the Target Company, Haikou University of Economics and Affiliated Art School of Haikou University of Economics;
4. Hainan WFOE, NewHoldCo, CEG PRC, the Target Company and the other related companies having entered into a management contract and other related agreements as set out in the Vendors A Agreement such that the Group shall be entitled to 100% of operating results of the Target Group from the date of the second payment to the end of February 2023;
5. the relevant internal control process of the Target Group has been established; and
6. the delivery of the company seals and other corporate documents of Hainan BVI, Hainan WFOE, NewHoldCo and other related companies to the Group.

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Third Payment

1. Hainan Shenzheng shall within five business days upon the fulfillment of the conditions below issue a payment notice to CEG PRC for an amount of RMB160,000,000 (equivalent to approximately HK$177,600,000) which shall be paid by CEG PRC within seven business days upon receipt of the said payment notice. The conditions to the third payment, inter alia, are as follows:
2. 1. the fulfillment of the conditions set out in (i) and (ii) above and such conditions remain true and accurate as of the third payment date;
   2. Haikou University of Economics having renewed the operation permit of private school (民辦學校辦學許可證) (''Permit'') and obtained a renewed Permit issued by the relevant authorities;
   3. having obtained the land-use rights certificate for Haikou University of Economics as the user of the phase 2 of Guilinyang campus;
   4. having obtained the approval from the fire department and the property ownership certificate for the phase 1 of Guilinyang campus;
   5. having obtained the relevant approvals for the adjustment in the development plan of Haikou University of Economics campus; and
   6. all equity transfers as contemplated under the Vendors A Acquisition have been completed.

Vendors B Acquisition

Date	7 August 2020

Parties (1) Purchaser B

(2) Vendors B

To the best of the Directors' knowledge, information and belief having made all reasonable enquiries, each member of Vendors B and their respective ultimate beneficial owners (where applicable) is a third party independent of the Company and its Connected Persons.

Assets to be acquired

Pursuant to the Vendors B Agreement, the Group conditionally agreed to purchase and Vendors B conditionally agreed to sell 15% of the equity interests in the Target Company.

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The consideration, payment terms and conditions

The consideration for the Vendors B Acquisition is RMB188,000,000 (equivalent to approximately HK$208,680,000), which shall be paid to Hainan Hualian's designated bank account and will be satisfied in the following manner:

First Payment

1. the deposit of RMB37,600,000 (equivalent to approximately HK$41,736,000) shall be paid in cash within five business days upon the fulfillment of the following conditions:
2. 1. the signing of the Vendors B Agreement by the parties thereof;
   2. the representation and warranties given by Vendors B remain true, accurate and complete and not misleading, and Vendors B have fulfilled their obligations under the Vendors B Agreement and there is no material breach of the Vendors B Agreement;
   3. there are no existing or potential claims filed by any third party against any of the Target Company, Vendors B or its affiliates;
   4. there have been no material adverse changes in the financial, business or property, operating results, business prospects or assets of the Target Company, Vendors B and its related parties, and there has not been one or more events that individually or collectively caused material adverse effects; and
   5. there are no laws or government orders imposed or implemented that will render the transaction under the Vendors B Agreement illegal, restricted or prohibited.

Second Payment

1. an amount of RMB75,200,000 (equivalent to approximately HK$83,472,000) shall be paid in cash within 10 business days upon the satisfaction of the conditions including but not limited to:
2. 1. the fulfillment of the conditions set out in the above (i) and such conditions remain true and accurate as of this second payment date;
   2. CEG PRC and Hainan Shenzheng or their affiliates having entered into a sale and purchase agreement in relation to the acquisition of the 45% equity interests in the Target Company and the Company has announced the Acquisitions; and
   3. Vendors B having obtained all the requisite consent and authorization for the Vendors B Acquisition and registered with the relevant government authorities.

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Third Payment

1. an amount of RMB65,800,000 (equivalent to approximately HK$73,038,000) shall be paid in cash within 10 business days upon the satisfaction of conditions including but not limited to:
2. 1. the fulfillment of the above conditions (i) and (ii) and such conditions remain true and accurate as of this third payment date; and
   2. the completion of the business registration with the relevant authority in relation to the transfer of not less than 45% of the equity interests in the Target Company by Vendors A to the Group.

Fourth Payment

1. an amount of RMB9,400,000 (equivalent to approximately HK$10,434,000) shall be paid in cash within 10 business days upon the satisfaction of the conditions including but not limited to:
2. 1. the fulfillment of the above conditions (i), (ii) and (iii) and such conditions remain true and accurate as of this last payment date;
   2. having obtained the land-use rights certificate for Haikou University of Economics as the land user of phase 2 of Guilinyang campus; and
   3. Vendors B having issued a confirmation letter confirming that the above conditions were fulfilled.

The total consideration for the Acquisitions is RMB1,356,000,000 (equivalent to approximately HK$1,505,160,000). The Group has approximately RMB2,765,700,000 (equivalent to approximately HK$3,042,270,000) in total bank balances and cash as at 29 February 2020 as disclosed in its latest interim report. The Group therefore has sufficient internal resources to fund the transaction but as always would be open to other means of financing including but not limited to debt or equity fund raising, or a combination of the aforesaid, to finance current and future acquisitions.

Basis of the consideration for the Acquisitions

The aggregate consideration for the Acquisitions was determined after arm's length negotiation between the Company and Vendors A and Vendors B after considering the following factors: (i) the unaudited consolidated net profits after tax of the Target Company for a period up to the year ended 31 August 2019 and the eight months ended 30 April 2020; and (ii) the factors as set out in the section headed ''Reasons for and Benefits of the Acquisitions''. Based on the above, the Directors are of the view that the aggregate consideration for the Acquisitions is fair and reasonable and in the interests of the Company and the Shareholders as a whole.

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Upon completion of the transactions contemplated under the Vendors A Agreement and the Vendors B Agreement assuming completion of the Vendors A Acquisition and the Vendors B Acquisition and after the deregistration of certain non-operating subsidiaries of the Target Company, the simplified shareholding structure of the Target Group will be as follows:

	CEG BVI
		100%
	Hainan BVI
			CEG PRC
		100%
	Hainan WFOE					100%
				NewHoldCo					Hainan
	contractual					Shenzheng
arrangements (Note 2)
	22.5%			37.5%			40%

Target Company

	100%					100%
Hainan University			Affiliated Art School
		of Hainan University
of Economics
		of Economics

Notes:

1. the above graph does not include all intermediary companies.
2. the dotted line represents the contractual arrangements between Hainan WFOE and NewHoldCo.
3. the solid lines represent equity interest holdings.
4. the dotted circle represents the Target Group.

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INFORMATION ABOUT THE PARTIES TO THE SALE AND PURCHASE AGREEMENTS

Information of the Group

The Group is a leading global higher and vocational education group with footprints in China, Australia and the United Kingdom, with a vision to provide quality education through innovation. As at 29 February 2020, the Group's network of schools includes six higher education institutions and three vocational education institutions in China, including the No.1 ranked private university in the country, a higher education institute in Sydney, Australia and a university in London, the United Kingdom. The Group is also the largest listed higher and vocational education provider in China in terms of student enrollment. As at 29 February 2020, the Group enrolled approximately 182,000 students.

CEG PRC is limited liability company incorporated in the PRC and a fully consolidated affiliated entity of the Company. CEG PRC is principally engaged in the business of providing investment and management services in the education industry and related consultancy services.

CEG BVI is an investment holding company incorporated in the British Virgin Islands with limited liability and a wholly-owned subsidiary of the Company.

Information of the Target Group

The Target Company is a company incorporated in the PRC with limited liability. It is the sole sponsor of Haikou University of Economics and the Affiliated Art School of Haikou University of Economics.

The table below sets out certain unaudited financial information of the Target Group prepared pursuant to the Generally Accepted Accounting Principles of the PRC for the years ended 31 August 2018 and 2019 and the eight months ended 30 April 2020:

			Eight months
	Year ended 31 August	ended 30 April
	2018	2019	2020
	(unaudited)	(unaudited)	(unaudited)
	RMB'000	RMB'000	RMB'000
Revenue	515,828	578,189	419,583
Net profit (before tax)	77,764	49,548	31,842
Net profit (after tax)	73,163	44,733	29,184
Earnings before interest, tax, depreciation
and amortization (''EBITDA'')	224,846	242,132	165,763

The net profit (after tax) decreased from RMB73,163,000 for the year ended 31 August 2018 to RMB44,733,000 for the year ended 31 August 2019. The decrease was mainly associated with finance cost. For the same period, the EBITDA increased from RMB224,846,000 to RMB242,132,000.

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The unaudited total assets and net asset value of the Target Group as at 30 April 2020 is approximately RMB3,029,630,000 and RMB359,118,000, respectively. The unaudited cash and cash equivalent and interest-bearing liabilities of the Target Group as at 30 April 2020 is approximately RMB89,592,000 and RMB1,447,761,000, respectively.

Haikou University of Economics is a higher education institution in the PRC and is the largest private university in Hainan. As at December 2019, it has student enrollment of approximately 42,000, of which 22,000 are regular higher education programs students. Its annual enrollment quota for regular Bachelor's and Junior College programs in 2020 exceeds 11,000 students, which has grown rapidly by 58% compared to two years ago. Being approved to provide Bachelor's degree programs by the Ministry of Education of the PRC in 2008, it is the most established private university in Hainan. It has been highly successful in operating high-quality colleges especially for arts and film-related programs. It is designated by Hainan government as a model private university of application-oriented education. In 2020, the tuition of its Bachelor's degree programs range from RMB23,900 (equivalent to approximately HK$26,529) to RMB99,900 (equivalent to approximately HK$110,889) per year.

Affiliated Art School of Haikou University of Economics is a vocational school in the PRC. Its total enrollment is about 1,500 students in 2019/20. Students graduating from the school may progress to Bachelor's and Junior College programs in the Haikou University of Economics.

Information of other transaction parties

Hainan Shenzheng is an investment holding company incorporated in the PRC with limited liability.

Hainan Hualian is an investment holding company incorporated in the PRC with limited liability.

Hainan BVI is an investment holding company incorporated in the British Virgin Islands with limited liability.

Hainan WFOE is a wholly owned foreign enterprise in the PRC set up and wholly-owned by Hainan BVI and is principally engaged in the business of education consulting and management.

NewHoldCo is an investment holding company to be incorporated in the PRC pursuant to the Vendors A Agreement. Upon completion of the Acquisitions, it will own 22.5% of the equity interests of the Target Company and will be a fully consolidated affiliated entity of the Group.

Mr. CJ Cao and Mr. YK Cao are PRC residents.

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REASONS FOR AND BENEFITS OF THE ACQUISITIONS

As disclosed in the 2019/2020 interim report of the Company, the Group has formulated the merger and acquisition strategy to achieve growth target taking into account the high entry barrier of the higher education sector. The acquisitions under the Sale and Purchase Agreements mark the Group's education foothold in Hainan.

Hainan is the largest special economic zone in China, enjoying unique advantages in terms of natural environment, supportive policies and development potential. According to the "Master Plan for the Construction of Hainan Free Trade Port" published by the State Council of the PRC on 1 June 2020, preferential measures include duty-free for most imported goods, lowered corporate income tax and individual income tax, more relaxed visa-free entry policy, as well as more openings in various fields including the education sector, which are all aimed at developing Hainan into a new highland for China's reform and opening-up policy.

Having considered the strategic location, reputation, stage of development, number of enrolled students and income of the Haikou University of Economics and the Affiliated Art School of Haikou University of Economics, the Directors consider the Acquisitions provide the Group with attractive growth potential in the PRC higher education market for more diversified and higher revenue.

The Board believes that the Acquisitions will be complementary to the Group's existing school network. The Acquisitions will enable the Group to further expand its portfolio, especially in the Hainan region. The Board is therefore of the view that the Acquisitions are important lateral expansion of the Group's existing business.

Having considered the aforesaid, the Directors consider that the transactions contemplated under the Sale and Purchase Agreements are fair and reasonable and in the interests of the Company and the shareholders of the Company as a whole.

None of the Directors has a material interest in the transactions contemplated under the Sale and Purchase Agreements or is required to abstain from voting on the Board resolution for considering and approving the same.

IMPLICATIONS OF THE LISTING RULES

As one of the applicable percentage ratios under Rule 14.07 of the Listing Rules in respect of the Acquisitions in aggregate is more than 25% and less than 100%, the Acquisitions constitute a major transaction of the Company under Rule 14.06 of the Listing Rules and are subject to the reporting, announcement, circular and Shareholders' approval requirements under Chapter 14 of the Listing Rules.

GENERAL

To the best of the knowledge, information and belief of the Directors having made all reasonable enquiries, no Shareholder has a material interest in the Acquisitions. As such, no Shareholders would be required to abstain from voting in favour of the resolution approving the Acquisitions. As at the date of this announcement, the Controlling Shareholders, being a closely allied group of Shareholders, control an aggregate of 1,500,000,000 Shares, which

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represents approximately 74.25% of the total number of issued shares of the Company. Accordingly, pursuant to Rule 14.44 of the Listing Rules, written Shareholders' approval may be accepted in lieu of holding a general meeting of the Company to approve the terms of, and the transactions contemplated, under the Sale and Purchase Agreements upon satisfaction of the conditions set out under Rule 14.44 of the Listing Rules.

The Controlling Shareholders are Blue Sky Education International Limited and White Clouds Education International Limited, which are interested in 37.12% and 37.12% of the Company's shareholding respectively as at the date of this announcement. Mr. Yu Guo, Mr. Xie Ketao, Blue Sky Education International Limited and White Clouds Education International Limited entered into the concert party agreement to align their shareholding interests in the Company. Accordingly, each of Mr. Yu Guo, Mr. Xie Ketao, Blue Sky Education International Limited and White Clouds Education International Limited is deemed to be interested in the Shares/underlying Shares held by other parties to the concert party agreement. The interests of Blue Sky Education International Limited and White Clouds Education International Limited were duplicated with the interests of Mr. Yu Guo and Mr. Xie Ketao. As such, the Controlling Shareholders are a closely allied group of Shareholders.

A circular (for information purposes only) containing, inter alia, further details of the Acquisitions will be despatched to the Shareholders. As it is expected that additional time will be required to prepare the relevant information to be included in the circular, the Company will apply to the Stock Exchange for an extension of time for despatch of the circular by no later than 30 October 2020.

Shareholders and potential investors should note that the Acquisitions are subject to the satisfaction and/or, where applicable, waiver of a number of conditions. As the Acquisitions may or may not proceed, Shareholders and potential investors are reminded to exercise caution when dealing in the securities of the Company.

DEFINITIONS

In this announcement, the following expressions shall have the following meanings, unless the context requires otherwise:

''Acquisitions'' ''Board'' ''CEG BVI''

''CEG PRC''

Vendors A Acquisition and Vendors B Acquisition

the board of Directors of the Company

China Education Group Holdings (BVI) Limited, a company incorporated in the British Virgin Islands with limited liability and a wholly-owned subsidiary of the Company

Shuzhi Education Consulting (Ganzhou) Co., Ltd. (術智教 育諮詢（贛州）有限公司), a company incorporated in the PRC with limited liability and a fully consolidated affiliated entity of the Company

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''Company''

''Connected Person(s)''

''Controlling Shareholders''

''Director(s)'' ''Group''

''Hainan BVI''

''Hainan BVI Transfer'' ''Hainan Hualian''

''Hainan Shenzheng''

''Hainan WFOE''

''Hong Kong''

''Listing Rules''

''Mr. CJ Cao'' ''Mr. YK Cao'' ''NewHoldCo''

China Education Group Holdings Limited (中國教育集團控 股有限公司), a company incorporated in the Cayman Islands with limited liability, the shares of which are listed on the Main Board of the Stock Exchange

has the same meaning as ascribed thereto under the Listing Rules

Blue Sky Education International Limited and White Clouds Education International Limited

the Directors of the Company

the Company, its subsidiaries and its consolidated affiliated entities

SAIPOLO Limited, a company incorporated in the British Virgin Islands with limited liability

the transfer of 100% shares in Hainan BVI to CEG BVI

Hainan Hualian Investment Co., Ltd. (海南鏵聯投資有限公 司), a company incorporated in the PRC with limited liability, being the holder of 15% equity interests of the Target Company as at the date of this announcement

Hainan Shenzheng Industrial Group Co., Ltd. (海南申正實 業集團有限公司), a company incorporated in the PRC with limited liability, being the holder of 85% of the equity interests of the Target Company as at the date of this announcement

a wholly owned foreign enterprise in the PRC set up and wholly-owned by Hainan BVI

the Hong Kong Special Administrative Region of the People's Republic of China

the Rules Governing the Listing of Securities on the Stock Exchange

Mr. Cao Chengjie (曹成杰)

Mr. Cao Yeke (曹業科)

a company to be incorporated in the PRC pursuant to the Vendors A Agreement

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''PRC''

''Purchasers A'' ''Purchaser B'' ''RMB''

''Sale and Purchase Agreements''

''Shareholder(s)'' ''Shares'' ''Stock Exchange'' ''subsidiary(ies)''

''Target Company''

''Target Group''

''Vendors A''

''Vendors A Acquisition''

''Vendors A Agreement''

the People's Republic of China, which for the purpose of this announcement, will exclude Hong Kong, the Macau Special Administrative Region of the PRC and Taiwan

CEG PRC and CEG BVI

CEG PRC

Renminbi, the lawful currency of the PRC

Vendors A Agreement and Vendors B Agreement

registered holder(s) of the issued Share(s)

ordinary share(s) of the Company

The Stock Exchange of Hong Kong Limited

has the meaning ascribed thereto in section 15 of the Companies Ordinance (Chapter 622 of the Laws of Hong Kong)

Hainan Cyber Education Group Co., Ltd. (海南賽伯樂教育 集團有限公司), a company incorporated in the PRC with limited liability and is owned collectively by Hainan Shenzheng and Hainan Hualian as at the date of this announcement

the Target Company and its subsidiaries, namely Haikou University of Economics (海口經濟學院) and Affiliated Art

School of Haikou University of Economics (海口經濟學院 附屬藝術學校)

the vendors for the Vendors A Acquisition, being Hainan Shenzheng and Mr. CJ Cao

the proposed acquisition of 45% equity interests in the Target Company by Purchasers A from Vendors A pursuant to the Vendors A Agreement

the agreement entered on 7 August 2020 between the Purchasers A, Vendors A and the Target Group in relation to the Vendors A Acquisition

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''Vendor B''	the vendors for the Vendors B Acquisition, being Hainan
	Hualian and Mr. YK Cao
''Vendors B Acquisition''	the acquisition of 15% of the equity interests in the Target
	Company by Purchaser B from Vendors B pursuant to the
	Vendors B Agreement
''Vendors B Agreement''	the agreement entered on 7 August 2020 by Purchaser B
	and Vendors B in relation to the Vendors B Acquisition
''%''	per cent

For illustrative purpose only, conversion of RMB into HK$ in this announcement is made at the following exchange rate: RMB1.00 = HK$1.11.

The English names of the PRC entities (including schools), PRC laws or regulations and the PRC governmental authorities referred to in this announcement are merely translations from their Chinese names and are for identification purposes only. If there is any inconsistency, the Chinese names shall prevail.

By order of the Board

China Education Group Holdings Limited

Yu Guo	Xie Ketao
Co-Chairmen
Hong Kong, 7 August 2020
As at the date of this announcement, the executive directors	of the Company are

Mr. Yu Guo, Mr. Xie Ketao, Dr. Yu Kai and Ms. Xie Shaohua, and the independent non- executive directors of the Company are Dr. Gerard A. Postiglione, Dr. Rui Meng and Dr. Wu Kin Bing.

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