“This acquisition adds a new dimension to Loyalist’s vertical integration strategy,” said Loyalist CEO Andrew Ryu in a statement. “We look forward to welcoming the Uhak team into the Loyalist family.”
Loyalist Group owns and operates private ESL schools, Career Colleges and Community Colleges in Canada. Its brands include PGIC, Pan Pacific College, Cornerstone Academic College (CAC), KGIC and MTI Community College.
The group has also announced record Q3 results with revenue up on the same quarter in 2013 by 93%, in large part due to its acquisitions.
Ryu commented, “we continue to devote significant resources to the integration and consolidation of our acquisitions so that we can realise the synergies inherent in our consolidation strategy”.
Uhak.com is a leading player in the education counselling indsustry – it has eight branch offices in South Korea and overseas offices in Canada, the US, England, Australia, New Zealand and the Philippines.
“This acquisition adds a new dimension to Loyalist’s vertical integration strategy”
“By acquiring one of our largest agency partners, we will be in a position to reduce our direct costs of attracting students, as well as strengthening ourselves a source for growing our student population, with an expected annualised additional net benefit of approximately $2m within the first year,” said Ryu.
Ryu added that Korean students do not have to necessarily attend one of the Loyalist branch schools in order for the company to benefit: “we will share in the commission fees for students who might choose to attend a school in another country.”
Adding further details about commission, David McAdam of Loyalist told The PIE News “on a consolidated basis we will get all of the commission revenues that Uhak earns, last year that was approximately $10.3m.”
“If approximately 10% of the Uhak placements come to a Loyalist brand school, then we would see 90% of that revenue (on a consolidated basis) being new revenue to Loyalist,” he added.
Speaking about the future of the Uhak brand, McAdam said: “As Uhak is one of South Korea’s largest agencies and has good brand recognition our immediate and near term plan is to maintain that brand.”
“As Uhak is one of South Korea’s largest agencies and has good brand recognition our immediate and near term plan is to maintain that brand”
“We have a long history with Uhak through our various brands, those relationships have existed for longer than Loyalist has been around,” he added.
The final terms of the deal are expected to be completed by December 5.
Established in 1981, “Uhak”, which means “study abroad” in Korean, changed its name from Munhwa Corporation to Uhak.com in the year 2000, to reflect its expansion into the online market.
Since then, several Korean agencies have been established with variations of the “Uhak.com” in their titles.
The company has over 140 staff, and at this time neither company is commenting on their roles going forward until next month, when the deal will be finalised.
Uhak is headquartered in Jongno, Seoul and its other Korean offices are in Gangnam, Shinchon, Bundang, Daegu, Daejeon, Busan and Gwangju. Uhak’s overseas offices are located in New York, Vancouver, Toronto, Victoria, London, Sydney, Brisbane, Melbourne, Auckland and Cebu.