Mr. Santos: ChinaCast Education is a for-profit, postsecondary education company in China that provides both bricks-and-mortar campuses and a nationwide e- learning network in China. I believe we're the first and right now the only education company publicly listed in the United States that owns accredited universities in China. Over the next several years, what we'd like to do is build a nationwide network of campuses and use our e-learning to address the very huge demand for postsecondary education services in China, not only for the basic 18- to 23- year-old demographic, but eventually the 23- to 40-year old working adult education market that's very prevalent in the United States. So essentially what we're trying to do is to build a DeVry or University of Phoenix of China over the next three to five years. Although China recently surpassed the United States two years ago as the largest university population in the world with over 22 million students - where the United States has about 18 million students - only 5% of the population of China has a four-year college degree as opposed to 25% or more in most Western countries. So the penetration rate is still very low. In addition, the Ministry of Education of China, the regulatory and accreditation body, has recently announced that they'd like to increase that to 40 million students over the next 12 years, by 2020. So the Chinese government has the daunting task of trying to build up their university seats so that they can educate a much higher proportion of their population and are now allowing private universities and online degree programs to help address the demand-supply imbalance. The company actually got its start in the dot-com days back in 1999, when the company received a nationwide wireless broadband Internet by satellite license from the PRC government. This was followed by a 17 million Series A VC investment lead by Hughes Network Systems and Intel Capital. We went into commercial service with our broadband satellite services in 2001 and started focusing on providing turnkey distance learning services to state-owned universities. We became profitable with 18 months and then went public on the Singapore Stock Exchange in May 2004, raising about 30 million. We then reverse-merged into an OTC-listed SPAC called Great Wall Acquisition Corp. in December 2006 and then delisted from the Singapore Stock Exchange in early 2007, and moved our listing to the Nasdaq on October 2007. Once we reached the Nasdaq, we embarked on a strategy to transition from a distance education service provider to a for-profit postsecondary education company by acquiring our own accredited degree programs. Thus, we acquired our first bricks-and-mortar accredited university in Chongqing last April 2008 and have recently announced a memorandum of understanding to acquire our second bricks-and-mortar accredited university, which we are targeting to close within 3Q09.
Tickers included in this excerpt: CAST
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