Noah Education Announces Completion Of Strategic Investment In Franklin Publishers

SHENZHEN, China, Feb. 26 /PRNewswire-Asia-FirstCall/ -- Noah Education (NYSE: NED) ("Noah" or the "Company"), a leading provider of interactive educational content and education services in China, announced today the completion of its strategic investment in Franklin Electronic Publishers, Incorporated ("Franklin"), effective February 24, 2010, and pursuant to the definitive agreement it entered into on October 8, 2009.

Noah's strategic investment in Franklin consisted of US$1 million in Series B Preferred Stock and US$2 million in Series A Preferred Stock, for a total consideration of US$3 million, or approximately a 20% interest in Franklin.

Noah purchased the US$2 million, or 800,000 shares, of Series A Preferred Stock from Shining Sea Limited ("Shining Sea"), an investment vehicle principally owned by a trust created for the benefit of Dr. James Simons, the founder of Renaissance Technologies LLC, and his family. Shining Sea concurrently purchased 365,630 ordinary shares of Noah, representing approximately 1.0% of the Company's outstanding ordinary shares, from Global Wise Technologies Limited and Dynamic View Investments Limited, two existing shareholders of Noah, at a pre-agreed price of US$5.47 per share.

As a 20% stakeholder in Franklin, Noah now has the potential to gain considerable investment income from this transaction, as Franklin is actively working to expand its business and further drive profitability. The strategic investment in Franklin is also expected to serve as a solid foundation for close collaboration and cooperation between the two companies. As part of the agreement entered into in October 2009, Noah and Franklin have agreed on a series of business cooperation arrangements. First, Noah has been granted exclusive sponsorship of Franklin's Global SpellEvent in China, a widely attended and renowned event ideal for brand promotion. Second, the Company will be able to leverage Franklin's distribution networks to market and distribute its digital learning devices outside China, thus providing an established infrastructure for geographic expansion. Third, this partnership will create new opportunities for top-line expansion, as Noah has been granted right of first offer as the preferred original design manufacturer (ODM) in China for Franklin's handheld electronic products and handheld language learning devices. Finally, the partnership will allow Noah to enhance its capabilities and generate cost savings through joint R&D initiatives.

"We are pleased to complete our strategic investment in Franklin and we look forward to fostering a mutually beneficial relationship," said Mr. Dong Xu, Noah's Chairman and Chief Executive Officer. "Franklin's globally-recognized brand, international distribution networks and renowned SpellEvent in China will not only provide us with the tools necessary to broaden our geographic footprint, but will also help us further extend our presence and leadership within China. Since the announcement of this transaction last October, we have already begun to see the benefits of this partnership as our R&D talents have joined forces to collaborate on a Chinese Learning Device, which will be marketed outside China through Franklin's extensive sales networks. Noah has also seen a substantial rise in ODM orders thanks to Franklin, and we expect our ODM business to grow significantly over the course of fiscal year 2010. I am confident that, going forward, both Franklin and Noah will be able to further enhance their respective brand awareness and capture new growth opportunities by capitalizing on the strong synergies between the two companies."

"During the quarter ending December 31, 2009, Noah became Franklin's largest contract manufacturer in terms of revenue, underscoring one of the many synergies resulting from this alliance. We expect our overall business with Noah to continue to grow, not just in terms of ODM, but also in terms of promoting Franklin's knowhow, brand and content in the China market. Similarly, we plan to help expand Noah's reach into the US and European markets Franklin serves, for example with a line-up of Chinese language learning devices," said Barry J. Lipsky, President and CEO of Franklin Electronic Publishers.

"We also look forward to working with Noah on the 2nd Annual Beijing SpellEvent China this May, in preparation for the final global event in New York in August," Mr. Lipsky added.

About Franklin

Franklin Electronic Publishers Incorporated is a world leader in electronic handheld information, having sold approximately 42,000,000 electronic books. Current titles available directly or through partners number more than 116,000 in sixteen languages under license from world class publishers, such as Merriam-Webster, Oxford University Press, Larousse, Langenscheidt, PONS, and HarperCollins, focused in four areas: Language Expansion, Language Learning, Reading Enhancement and Writing Enhancement. The Company also licenses its underlying technology to an array of partners including Adobe and Sun Microsystems. Franklin's products are available at 49,000 retail outlets worldwide, through catalogs, and online at http://www.franklin.com .

About Noah

Noah Education Holdings Limited is a leading provider of interactive educational content and education services in China. Noah's core offering includes the development and marketing of interactive educational courseware content, electronic learning products (ELPs), software, kids' English training and after-school education services. Noah combines standardized education content with innovative digital and multimedia technologies to create a dynamic learning experience and improve academic performance for kids in China aged 3-19. Noah has developed a nationwide sales network, powerful brand image, and accessible and diverse delivery platforms to bring its innovative content to the student population. Noah also provides a kids' English training service under the brand Little New Star in its direct-owned schools and approximately 700 franchise schools throughout China. Noah was founded in 2004 and is listed on the New York Stock Exchange under the ticker symbol NED.

Forward-Looking Statement

This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, including certain plans, expectations, goals, and projections, which are subject to numerous assumptions, risks, and uncertainties. Forward-looking statements involve known and unknown risks, uncertainties and contingencies, many of which are beyond our control which may cause actual results, levels of activity, performance or achievements to differ materially from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. The Company's actual results could differ materially from those contained in the forward-looking statements due to a number of factors, including those described under the heading "Risk Factors" in the Company's final prospectus filed with the Securities and Exchange Commission on September 24, 2007, and in documents subsequently filed by the Company from time to time with the Securities and Exchange Commission. Unless required by law, the Company undertakes no obligation to (and expressly disclaims any such obligation to) update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

    For more information, please contact:

    Investor Contact:

     Jerry He
     CFO and Executive Vice President
     Noah Education Holdings Ltd
     Tel:   +86-755-8204-9263
     Email: [email protected]

    Investor Relations (US):

     Kelly Gawlik
     Taylor Rafferty
     Tel:   +1-212-889-4350
     Email: [email protected]

    Investor Relations (HK):

     Ruby Yim
     Taylor Rafferty
     Tel:   +852-3196-3712
     Email: [email protected]

SOURCE Noah Education