NetDragon Websoft is acquiring 100% stake in Edmodo, a US-based education learning community for $137.5 million in cash and shares of NetDragon's education subsidiary valued at a pre-acquisition valuation of $1.8 billion. Edmodo is an education network offering a communication and collaboration platform to K-12 schools targeting teachers, students, administrators and parents.
According to Chinese news agency Xinhua, NetDragon is based in Fuzhou, capital of east China's Fujian Province. Initially known for its online games and mobile apps, the company has expanded its online education sector in recent years. Last year, it saw a revenue of 3.868 billion yuan (613 million U.S. dollars), 54 percent of which was contributed by education business. In 2015, NetDragon acquired 100-percent stake in Promethean, a London-listed provider of interactive learning technology.
Edmodo has 90 million registered users in 400,000 schools across 192 countries. By joining Edmodo's network and NetDragon's portfolio of technologies and platforms, including Promethean's education technologies, the combined entity will support users' learning activities within the classroom, at home and on-the-go with capabilities that include lesson preparation, lesson delivery, student collaboration, homework assignments, teacher-student-parent communications, education content marketplace and resources sharing.
“We are truly excited by the synergies and monetisation opportunities that will be created through this acquisition. We believe our complete product offerings will bring learning experience to another level for learners around the world, and more importantly, will continue to create value for our shareholders,” said Dr. Simon Leung, Vice Chairman and Executive Director of NetDragon.
“We are thrilled to be joining NetDragon to accelerate our mission of connecting all learners with the people and resources they need to reach their full potential. We will be able to innovate faster, provide more support to teachers and districts, and provide a deeper network with more resources and tools for all learners. We look forward to working with NetDragon to improve learning on a scale unmatched by other providers,” said Dr. Vibhu Mittal, Chief Executive Officer of Edmodo.
On this deal NetDragon was advised by Morrison & Foerster (MoFo). The team was led by Chuck Comey, Mike Krigbaum, and Venantius Tan, and it included Christopher Yap, Marshall Chu, Jim Ryan and Marcus To (corporate); Aki Bayz and Jonathan Gowdy (CFIUS and HSR); Stephanie Sharron and Susanne Peterson (TTG); Chris Lyon, Hayley Curry and Jay Donde (privacy); Bernie Pistillo and Matthew Lau (tax); Linda Barrett (executive compensation); and Nicole Elemen (labour and employment).
This story has been updated with inputs from Morrison & Foerster.