MAIL.RU GROUP LIMITED (LSE and MICEX-RTS: “MAIL”) (“Mail.ru Group” or the “Company”), continues to expand up its presence in the online education segment and today announces it is investing in Uchi Group, Russia's leading platform within the K-12 e-learning segment.
Uchi Group’s sales are expected to reach around RUB 3 bn in 2020, with nearly 3x growth YoY. Mail.ru Group is initially acquiring 25% of Uchi Group. The founders of Uchi Group will remain its shareholders and will continue working to develop the business.
Mail.ru Group will initially acquire a 25% stake in exchange for RUB 3.75 bn in cash along with a net cash adjustment payment to be finalized upon deal closure. There will be call and put options in place, providing Mail.ru Group with a path to a controlling stake in the platform in 2022-23. The initial put / call option to increase the stake to 49.5% can be exercised by Mail.ru Group in late 2021. The exercise prices under the options will be based on certain of Uchi Group’s key future financial performance indicators.
Uchi.ru, the company’s key product (approximately 90% of revenue in 2019), focuses on a free- or subscription-based self-education school format and covers all the key school subjects, including Math, Russian, English and other subjects as well as disciplines beyond school program like programming and soft skills. Students can also use the platform to prepare for exams and participate in online competitions. Uchi.ru holds a leading position on the Russian online K-12 segment, targeting over RUB 2.5 bn in sales in 2020. During the lockdown, Uchi.ru became the world’s No. 2 most visited educational website. Today, over 50% of all Russian schoolers (8 million people) and over 350 000 teachers are registered on Uchi.ru, with 37 million in monthly visits. The platform features more than 50,000 gamified tasks prepared by professional curriculum developers – each can be completed at any pace.
Uchi Group is also developing the Uchi.Doma (Study at Home) project focusing on one-on-one sessions with teachers. The project now offers English classes for 1st to 8th graders with unique content and approach.
Uchi Group has also been developing projects for international markets (HappyNumbers.com, Dragonlearn.org, BRICSMATH.COM) with a presence in the USA and Canada and pilots in India, China, Brazil and South Africa, Indonesia and Vietnam. In 2020, Uchi.ru’s international sales are expected to exceed $2mn, with 8x YoY growth.
Uchi Group is expected to deliver at least 30% sales CAGR in 2020–2023, with margin of over 30%+. For more details on the business model and key performance indicators of Uchi.ru, please click here.
“We are actively developing the education ecosystem of Mail.ru Group and expanding the range of services for people – from pre-schoolers to teens and adults – to study and improve their skills. Uchi.ru platform is a leading player in the online education market, boasting prominence both domestically and globally, and we are happy to have it join us. Uchi Group can be potentially integrated into the Mail.ru Group ecosystem,” commented Boris Dobrodeev, CEO (Russia) of Mail.ru Group.
“Online education is gaining momentum every year. To date, Uchi.ru platform has brought together eight million students and 350 000 teachers. By becoming part of Mail.ru Group's education ecosystem, we will be able to leverage its capabilities and tools to make our service even more useful for schoolchildren and teachers across the country,” said Ivan Kolomoets, co-founder of Uchi.ru.
Mail.ru Group takes a comprehensive approach to developing online education services ranging from preschool to vocational training. Algoritmika offers courses in programming and mathematics; Uchi.ru platform helps improve knowledge in multiple school subjects, programming and soft skills, while Tetrika connects students with tutors to prepare for exams. Educational projects supported by leading Russian universities enable students to master the most in-demand tech skills while getting a degree. GeekBrains, Skillbox, and SkillFactory projects help develop professional competences and master new skills. In addition, Mail.ru Group annually holds IT championships on its All Cups platform.
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