Wall Street English, a global provider of English-language tuition, will wind down its China operations, this publication can confirm, highlighting fatal operating conditions ushered in by the Covid-19 pandemic.

The organisation, which is backed by Baring Private Equity Asia, “has been losing a lot of money over the past 18 months and the Covid crisis tipped it over the edge,” a source at a rival organisation told this publication. The source said that they “can confirm” Wall Street English’s China arm will close as early as next week.

The Covid-19 pandemic, which closed thousands of schools worldwide and forced more than one billion students’ education online, has exposed the fragility of centre-based delivery models, many of which have struggled to pivot quickly to digital provision.

“The [Chinese] staff were told around 10 days ago to stop all sales and that the business would close month end,” the source said.

“It’s a massive business but badly structured for the change [to online provision] in the Chinese market and the rising cost of personnel,” the source added.

According to reports, Wall Street English has more than 70 centres across China, most of which are located in top-tier cities. It is one of the organisation’s largest markets.

David Kedwards, chief executive of Wall Street English, told this publication in an email that “we don’t comment on press speculation, particularly as the Covid-19 outbreak has created unprecedented stress across the global economy and resulted in a large degree of unfounded rumours.

“We are, however, making various adjustments to the business model to ensure we can meet the needs of our students and employees, which can often spin into more dramatic rumours.”

Hong Kong-headquartered Wall Street English derives the majority of its revenues from delivering face-to-face tuition at more than 450 brick-and-mortar franchise sites situated in China and other countries across Asia, Europe, Latin America and the Middle East.

The closure of its China operations lays bare the brutal trading conditions resulting from contracting economies, site closures and exam cancellations that centre-based tuition providers – and other education businesses – worldwide are contending with.

This week, a private preparatory school in the UK announced that it would close this summer as the pandemic “unravelled” its continuity plans.

Founded in 1972, Wall Street English has an alumnus of more than three million students and the company enrolled 180,000 in 2019. The organisation, which has a presence in 28 countries, was acquired by Baring Private Equity Asia – co-owner of international schooling giant Cognita – and CITIC in 2018 for $300 million from its former owner Pearson, the publisher.

According to reports published earlier this year, Wall Street English “forced” its employees in China to work throughout February on the expectation of full pay, but “a couple of days before pay day, Wall Street English cut pay by 50% and fired approximately 50% of their staff”.

Baring Private Equity Asia had not responded to a request for comment at the time of publication.