LAIX Inc. is an artificial intelligence (AI) company in China that creates and delivers products and services to popularize English learning. The flagship product is the 'English Liulishuo' mobile app.
On August 4, the company announced that its board of directors had received preliminary non-binding proposals from Wang Yi (co-founder, chairman of the board of directors and CEO ), Hu Zheren (co-founder, director and CTO), Lin Hui (co-founder, director and chief scientist) and PCILIVLimited. It plans to acquire all the issued common shares of the company in cash of USD 1.13 per common share (or ADS).
In addition, it is said that the company will establish a special committee of the board of directors composed of independent directors and unrelated directors to review the proposed transactions. At present, the company has not made any decisions.
English Liulishuo was founded in September 2012. As of March 31, 2021, the company had accumulated about 3.9 billion minutes of dialogue and 53.2 billion recorded sentences. It developed oral English evaluation, writing scoring engine and deep adaptive learning systems to provide users with better English learning solutions. The total number of registered users was 200.6 million as of Q1 2021.
The reason for its privatization is mostly due to unsatisfactory stock price performance. In 2018, the company (NASDAQ:LAIX) landed on the New York Stock Exchange and became the first share in the 'AI + education' segment. At that time, the issue price was USD 12.50. However, since listing, LAIX's share price performance has not been ideal. At present, the company's total market value is about USD 52.73 million, less than one-tenth of the first day of listing.
In May 2021, Liulishuo announced its financial report for the first quarter of 2021. According to the data, the company's net income was CNY 19.85 million, reflecting a decline for both year-on-year and month-on-month comparison. In the current period, it profits for the first time after listing, with a net profit of CNY 12.2 million, which should be attributed to the substantial reduction of the company's sales and marketing expenses.
Moreover, the company expects that in the second quarter of 2021, revenue will be between CNY 16 million and CNY 18 million, projecting a decrease of 33.2% to 40.6% over the same period of the previous year.