Voice software provider iFLYTEK announced to acquire MstChina, a test solution provider, for US$78 million

iFLYTEK to Acquire Test Solution Provider MstChina for RMB 480 million

By Tracey Xiang on June 25, 2013

Voice software provider iFLYTEK (SZ: 002230) announced to acquire MstChina, a test solution provider, for RMB 480 million (USD78 million).

MstChina’s offerings include English speaking and listening test software which must be the synergy between the two companies. iFLYTEK, having been focused on speech recognition technologies, now has a variety of voice-related services including Mandarin speaking test software, and an English speaking and listening test solution for middle schools.Its Mandarin test software had covered a majority of provinces and regions in China and eight million test takers as of the end of 2012. The one for English had been approved by Guangdong province in 2012 to be used in high school and college entrance exams later on. It is expected the acquisition would help iFLYTEK further expand to education sector.

Having been in speech recognition technologies for more than a decade,  iFLYTEK launched “Voice Cloud”, an initiative for third-party Internet services to build voice features, and “iflytek YuDian”, a Siri-like service last year. Now more than ten thousand third-party services have taken advantage of the Voice Cloud.

It is estimated that iFLYTEK covers over 70% of China’s voice-related market. Two months ago, China Mobile invested RMB1.36 billion ($221 million) in iFLYTEK for a 15% stake. The company also developed a Siri-like service, named Lingxi, for China Mobile that the latter would 1) pay 0.08 – 0.3 yuan per user every month, depending on the scale of user base, 2) share 30% of revenues from business-facing services, and 3) share 12.5% of income from China Mobile’s existing products that use iFLYTEK’s technologies, from January 2013.

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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