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New rules to regulate Chinese educational technology companies continue to cast a shadow over global stock markets.
Overnight, some of China’s billionaires lost most of their fortunes after the collapse in the market value of Chinese education companies, whether listed in China or on Wall Street.
New regulations prohibit Chinese educational technology companies from making profits, obtaining foreign investment, or going public, which would wipe out billions of dollars in the education technology sector.
Larry Chen, the former teacher who founded the online education platform Gaotu Techedu in 2014, cost nearly $ 15 billion after the company’s shares fell by nearly two-thirds in New York City trading Friday. As a result, his fortune fell to $ 336 million.
In turn, Zhang Bangxin, CEO of TAL Education Group, lost about $ 2.5 billion, reaching his fortune to $ 1.4 billion, after the company’s shares fell 71%.
The fortune of Yu Minhong, chairman of the board of directors of the New Oriental Education & Technology Group, also fell by $ 685 million, after the company’s shares fell 54%.
China recently issued new regulations prohibiting school curriculum companies from making profits, acquiring foreign investment, or going public, and also preventing industry investors such as Temasek Holdings and Tiger Global Management from exiting.
China’s $ 100 billion private and online education sector is the third after e-commerce and healthcare to face strict regulation in China.
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