English training giants plan on expanding in China

As the number of people who can speak English in the world's most populous country continues to grow - more than 400 million in 2010 by some reports - so are the number of English-training agencies.

On Dec 20, shareholders of Beijing-based Global Education & Technology Group Ltd approved a merger between the Nasdaq-listed English training company and London-based Pearson Inc, which also owns the newspaper Financial Times and publisher Penguin Group.

The $155 million (120 million euros) all cash deal was the fourth acquisition Pearson has made in China since 2009.

Wall Street English (WSE) was acquired by Pearson in 2009 for $145 million. Based in Beijing, WSE China now has 55 centers in eight major cities on the mainland.

"The group invested greatly in our training programs, such as training our teachers," says David Kedwards, CEO of WSE's international division. "We believe our English training will develop further in China and in the world under such strong support."

The company says it plans to open 15 new centers this year in China. It currently has more than 50,000 students and has trained 200,000 students in China in the past 11 years.

"In the past, people came to us and wanted to improve their English immediately because they worked in foreign enterprises or had business with foreigners," Kedwards says. "Now we have noticed many of our students come here without such direct need, but to learn English as an investment in themselves."

Kedwards is confident in the company's expansion plans in China despite fierce competition.

"Ninety percent of our students are white collar individuals, and we try our best to meet the individual needs," he says.

The company caters to adults who want to learn English, and targets China's young professionals for a price. A student pays, on average, 35,000 yuan ($5,560, 4,300 euros) for a two-year course, which has been certified by Cambridge and Harvard.

"Our teachers all have university qualifications and teaching qualifications and they also must pass a WSE course in teaching before we allow them to teach," says Paul Blackstone, WSE's CEO for China.

To provide a top-notch learning experience, all WSE centers in China are directly managed, he says, and it isn't considering franchises at this point.

Global English training giant EF Education, which has been operating in China for nearly 20 years, also expressed its growth ambitions in China.

Chen Ming, vice-president for Asia Pacific at EF, says the company has nearly 150 centers in more than 50 cities in China and plans to open 200 additional offices this year. The company currently has 15 million students worldwide and has trained nearly 1.5 million Chinese students in the past 18 years.

"We are still looking forward to the huge potential in China. There are 250 million to 300 million Chinese people who are learning English, so it is important for us to continually improve on quality and reach more customers," she says.

Different from WSE, EF teaches children and adults, and classes are less expensive. For adults, 160 classes cost 20,000 yuan. The school also provides online courses and an overseas English training camp for children.

According to Chen, EF is one of the few privately owned international companies without State-owned or venture capital. She says she believes the company's success lies in the insistence on providing the best education service and teaching quality.

Chen says students will spend their valuable money and time only on good courses, which will cause small and unprofessional training schools to close.

"With more competition in the field, the best ones will stand out," she says.

Meten English, a Shenzhen-based English training company, which is a very popular company in south China, is also looking to expand.

Company vice-president Si Donglin says it plans to grow from the current 25 centers to 90 across the country in the next three to five years.

It currently has more than 20,000 students. Classes are usually last four to six months, and cost 4,000-6,000 yuan.

He says as Meten looks to transform from a regional to a national brand, the company is considering financing from outside sources. It is looking for possible new partners or even going public, and maybe moving its headquarters to Beijing as a customer-oriented strategy.

"The number of our students grows by 20 to 30 percent each year. We always think of what our customer want. If customers in other big cities grow faster, we will focus there."