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Eikoh Buys Shane

Cram school operator, Eikoh Inc., has bought Shane English School.

Cram school operator Eikoh Inc. said Friday it has acquired Shane English School to strengthen its English-language education for elementary school children ahead of the planned compulsory teaching of the language for fifth- and sixth-graders.

Eikoh, based in the Kanto region, didn't disclose how much it paid for the acquisition of shares in the four operating companies that run the English school chain, which mainly operates in the Tokyo metropolitan area.

According to the announcement of the purchase [PDF] on Eikoh's website, Eikoh will acquire all shares in Shane Corporation Japan, Shane Corporation North Kanto, Shane Corporation East Kanto, and Shane Corporation South Kanto. While no price has been made public, a brief blurb in the Nikkei keizai shimbun says the deal was around 1 billion yen (about $12 million USD).

Screen shot from Nikkei online

Back to the Japan Times article:

Representatives of both Eikoh and Shane English School said the acquisition won't involve personnel cuts or other drastic changes in operations.

A source I know says that Eikoh and Shane has been in negotiations for some time. Apparently the deal is only for Shane's schools in Japan and not those in China and Taiwan, which are much more profitable. I suppose the deal is a safe one for Eikoh since Shane sells more monthly lessons as opposed to year-long packages, so they aren't any large hidden liabilities. Eikoh bought Shane as a strategic purchase in anticipation of English being introduced in elementary schools next year and English lessons being taught entirely in English in high schools in 2013.

I wonder about the promise of no personnel cuts or drastic changes. The Japan Times notes that 60% of Eikoh's and Shane's schools are in the same location. I take this mean that many or most of the schools are in the same building, not just near each other in the same neighbourhood. In their announcement, Eikoh sees this as having a synergistic effect. It's publishing company, Educational Network, get a shot in the arm from Shane's business. Eikoh gets to conveniently sell English lessons at Shane to its cram school students. Moreover, with 40% of Shane's students being junior high school students or younger, they are perfect candidates for cram schools.

The promise of no drastic changes makes the last paragraph of the article funny:

Takehiko Kikuchi, a PR representative for Shane English School, said company employees and teachers received the news calmly.

Nobody freaked out. No worries, everything is OK. Mergers aren't necessarily bad things, but in eikaiwa, recent history shows that they are almost always bad news, as seen with G.communication's takeover of Nova and GEOS. Whether or not Eikoh's purchase pays off remains to be seen.

Comments

Hey I really trust Japanese companies especially the eikawas they all follow the rules of the free market right? YAY for Japanese capitalism! Supply and demand baby! Look at my brand new CELTA certificate! time to start making 250,000 en a month!

And if you're dumb enough to believe that you're dumb enough to work as an English teacher in Japan.

This one sounds like the last move in a transaction that has been going on for a while.

Is the education money all going into the cram schools? I caught the Japan Times headline about families spending an average of 2 million yen a year on education expenses, which, as I blog, is unbelievable.

Is the money going to Eikoh and sister jukus? No wonder they were willing to pay $12 million for Shane.

The Master has a point in a way. Though i do hope he took a walk outside for a bit.

I think his point was to attack the people who automatically disparage the English learning system here in Japan. And whilst he went a bit far i agree with him on the first point. So many people come on to this blog with massively negative attitudes! Why bother? If you hate it here so much why don't you leave? Or if you hate your current company so much then why don't you quit and look for another job? Either way, why do so many people feel the need to be so negative here? Surely we can criticize something and be positive too?

I know i'm probably going against the flow on this one, but as regular reader of this site i hope that the posters can become a bit more positive from now on. A fools hope i know.

If the board was meant to be one that to discuss the good of Eikaiwa teaching, then the followers would people posting what a great time they're having at it.

It's a board for industry information and rumor. "Debunking Eikaiwa"--that's what it says at the top.

Recent industry moves like the Interac partner buy-out and now Eikoh-Shane do show that there is money in teaching English, despite Nova and GEOS. It suggests that yet another Japanese shell game is at work, where it's pretend the money really isn't there to adequately staff and pay for English teaching. But then, at the end of the day, well, these companies keep going and in fact end up doing well.

People gripe because they have legitimate beefs that Japan doesn't address. The attitude isn't even so much "why don't you just go home?" but "watch us do nothing until you give up and go home. Then we can say it was you not us."

If Japan regulated English teaching as well as it regulates other things, there would be no demand for the gripe part of a website focused on an industry. Since Japan keeps English teaching as the Wild West, people will want to talk about the pitfalls.

Thank you, Shawn, for such a wonderful site. You seem to be the only one that is keeping the Eikawa/ Japanese school madness in check. Nice to have someone who can stand up to the idiot managers and Japanese corruption.

Back to the Japan Times article:

Representatives of both Eikoh and Shane English School said the acquisition won't involve personnel cuts or other drastic changes in operations.

I've heard this statement made too many times by other g-ompanies who take over English schools. While it would be nice to believe it, is really in the interests of both parties (why pay money to hire and train new employees when you have already "trained" staff available?), and I certainly hope that it is possible and does happen in this case, recent history has shown us otherwise.

It sounds reasonable that they would not be making major staffing changes, because they just paid the $12 million. Why pay the money if you plan on just going out and getting new staff?

It looks like a number of the Shane schools were already operating within Eikoh facilities. Maybe: Is the $12 million the deposit money on the other Shane rented locations?

It strikes me that turnover in the Shane operation was about as high as anywhere.

Hoofin, I read your response to what Lucas said:

You write calmly which is nice, but are you negating the value of what Lucas said?
This website is 90% bickering, complaining, talk of revenge on the MONSTER CALLED EIKAIWA, sharing ideas how to screw over schools (i.e. ; how to steal their students, get sex from students, get visas and run), dark predictions (NOVA DOWN ! GEOS DOWN !! THREE TO GO !! AEON's NEXT !!").
There are thousands of gaijin in Japan right now who are teaching English right now and they are well-paid and extremely happy....
and guess what -
They don't even know that this negative pessimistic depressing blog exists !!!!

Hoofin i never said that it was a board to discuss "good of eikaiwa teaching". I agree whole heartedly with what you say, my only issue is that many of the posters here turn it into a spiteful "i was ripped off" whinge which doesn't help anyone.

If people wish to stand up to the companies then do so! Use blogs as your vent but better yet, use this blog as a rallying call. Organise the people and stand up to our respective companies. If we act as one we may achieve the desired results.

My point though was why does everyone need to be so negative? Can we not complain about the situation we are in without attacking other people or at least use polite language? Do we have to be so cruel to one another? That was my point.

Agreed. Thank you for the support. But sadly i suspect we will be hounded down by the doomsayers. I am one of those happily employed people BTW.

Mr. P: you seemed to be a little bit obsessed on here. Did you lose your job? Lots of time alone at home whining about this site? Time to move on, don't you think? Your whining will never change this site. People like you come and go on here all the time.

This site has some b.s., but mostly it is VERY useful to us who either worked or are connected somehow to the dirty Eikawa industry. That includes Japan and all the countries that have Japanese-owned language schools in them. GEOS Canada and all their shameful, corrupt tactics is just just one example of the latter.

I'm in Canada right now and I just got sponsorship from one of the bigger eikaiwa schools (but not in the category of "Biggest schools") but you know what -after reading this blog -I've decided to cancel the visas and call the whole thing off. My girlfriend is going to be very disappointed. It was more difficult for her to get the visa (in the same Prefecture where I got a job). She'll get home from work in an hour or so and then I'll show her this blog. She'll understand and agree with my decision ( I hope).

Ms. Patty...Mr. P...One in the same.

The only reason anything is "negative" on here is because the Eikawa industry/ scam-industry/ used car dealers are so horrible and corrupt. A huge ponzi scheme. Shawn's blog has done wonders to uncover this and bring attention to what needs attention. The whiners are usually just part of that corrupt industry, so they do not like their shenanigans being exposed...What scammer does like his/ her scam being exposed for all to see?

I am sure Shawn is fine and knows that he has many supporters around the world. And many of those supporters have been greatly helped and warned in advanced of some pretty scummy Eikawa practices. Thanks, Shawn, for warning us even if indirectly.

Sorry I missed Lucas' point.

I agree with the repetitive bickering posts. Usually I just scroll through those.

The last time I talked to Shawn I thought he mentioned that there would be an overhaul or new format for the site. He gets about 800 uniques a day (people beyond those who spend time in the comments bickering.)

It's really quite a resource and help many to understand that when the situation is difficult in Eikaiwa, there are clear reasons why.

Mr. P: I agree with your A-san, B-san, C-san skit above. That's usually what I scroll through. Comment moderation is quite an art on the net, and time consuming.

As part of long-term plans we have investigated the scenario in Japan and thanks to this site and others we have no plans to live and work in Japan. I would like to thank the site owners for providing such a valuable and candid view of the reality on the ground in Japan. You saved us time and money and that is appreciated.

I used to be an eikaiwa teacher, it's a pretty tough racket.

Luke

I've lost count of the number of people who told me they signed up as students, on the promise that they'd be taught by British teachers, only to walk into their first lesson, to find a non-Brit teacher.

Before anyone jumps on me, I'm not suggesting British teachers are better, I'm just showing how Eikaiwa relies on lies, to hook 'suckers'.

Eikoh is in for some surprises on the publishing book distribution side of things. Basically Saxoncourt Publishing's only customer was Shane schools and then it was a very interesting chain of sales. Saxoncourt sells the books to Nellies. Nellies sells the books to Shane Schools. Shane Schools sells the books to the students. The same revenue is recorded 3 times to bolster the apparent income. I wonder how Eikoh is going to feel about that.

When Nova University takes over. When Nova University starts people will flock to Nova again. All these small fry names will be forgotten. Sooner the better.

i wrked for shane last year in Tokyo

life at shane,,,

get up at 9pm spend 2 hours travelling to work,,start work at 11 am or 12,,,finish,,,,get home from work at 10 or 11 at night,,,,later if i went to shops,,,,,cook eat about 12,,,,,,go to sleep and do it all again

told not to teach english but just have fun with students,,,i was only teacher at every school i worked alone and i worked at 5 diffrent schools a week in 3 differnt pref..,,,,such a boring life

i saw my boss twice in a year once when i arrved and once when i left ,,i never had a lesson watched by my boss or anybody,,,

very bad school and i never saw Japan i just worked all day,,,and worked mon-thurs,,and sat ,,,so no weekend

Japan is the worst country in Asia to work as an English teacher ,,low pay ,,over priced flat,,and i guess it,s japanese culture to live a boring life,,,men work,,work,,work,,and women stay at home,,,but japanese girls loe sex and are very easy,,, there is no romance with japanese people,,men and women love no strings sex but jut don,t get caught or talk about it and you will have a lot of fun

i agree with this link

http://teflblacklist.blogspot.com/2006/07/shane-schools-saxoncourt-recru...

and this was on wikipedia

a number of Shane English School & Saxoncourt around the globe have recently gone into receivership or been liquidated... But Mr Lipscombe owns his global empire via a company called "Saxoncourt Holdings Ltd" registered in the British Virgin Islands (where companies are not required to disclose the state of their finances on the public record), so it's hard to say but the principal of Shane English School Japan recently threatened that the company was in danger of going bankrupt

Shane English School japan is not actually a company, it is a brand name that "Shane Corporation Japan" and it's various subsidiaries operate their schools under. So, although your (English) contract may say that your employer is "Shane Corporation", this is not actually true, this is merely a tactic that the "Saxoncourt Group" uses to make it difficult for you (as an employee) to report your REAL employer to the authorities for breaking the law (because you need to know who your real employer is in order to report them).

2 million yen a year in education expenses per child, per year. And yet, that "education" prepares young Japanese for what, exactly, in the real world.
Juku. What a racket.

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