University Stories

A MESSAGE FROM FRED AYALA

October 1, 2018

Dear UNC Community,

Greetings!

In accordance with what I shared with you last January, I am very happy to announce that Ayala Corporation (“AC”) and AC’s wholly-owned education subsidiary AC Education, Inc. (“AC Education”), together with House of Investments Inc. (“HI”) and HI’s education holding company iPeople, inc. ("iPeople"), signed today the definitive agreements for the merger of AC Education with iPeople. The merger shall be subject to the approval of the stockholders of AC Education and iPeople, and securing the necessary regulatory approvals. Post-merger, listed iPeople shall be the surviving entity, with HI and AC controlling 51.3% and 33.5%, respectively. The transaction values the combined entity at approximately Php15.5 billion.

AC and HI will share governance and management of iPeople which, as a result of this strategic partnership, will become one of the leading education groups in the country, with almost 60,000 students.

The merger will bring together the 7 educational institutions of iPeople and AC Education, which together will offer quality education to students across all income segments, with campuses in Metro Manila, Calabarzon, the Bicol Region, and Mindanao. The merger will include iPeople and its significant subsidiary, Malayan Education System, Inc. (Operating under the name of Mapua University), one of the country’s leading engineering and technical universities, a world ranked QS-3 star university and the school with the most CHED Centers of Excellence in Engineering, and its subsidiaries, Malayan Colleges Laguna, the best board exam performing private higher education institution in Calabarzon, Malayan Colleges Mindanao in Davao, and Malayan Science High School in Manila. It will also include AC Education and its subsidiaries, the University of Nueva Caceres, one of the oldest and largest universities in Bicol, National Teachers College, the country’s pioneer private teachers' training tertiary education institution, and APEC Schools, the largest chain of private stand-alone high schools in the country.

“We are looking forward to the merger of AC Education and iPeople. Mapua's reputation as a leading private engineering and technical university in the country, together with AC Education's tested ability to provide affordable quality education, leading to the employability of its graduates, would enable the Yuchengco-owned House of Investments and Ayala Corporation to jointly contribute, in a bigger scale, to the Philippines and all sectors of society. Together, our schools will not only aim at educating our youth but also at preparing our graduates to become major players in sustainable businesses driven by adaptive technology,” said Mrs. Helen Y. Dee, Chairperson of House of Investments.

“We are looking forward to working closely with the Yuchengcos’ House of Investments in helping to build the nation through education. We believe that combining our resources and capabilities will allow us to, together, enable many more Filipinos to achieve their dreams of a better life for themselves, their families and communities, by arming them with the values, critical thinking, global mindset and 21st century skills that are necessary to succeed in this rapidly changing world," said Jaime Augusto Zobel de Ayala, Chairman and CEO of Ayala Corporation.

I am very confident that this union of exemplar organizations will be a big positive for UNC, and will enable us to transform even more lives through education. We remain committed to delivering a high quality, affordable education that empowers our students to make it, in a nurturing environment.

For questions or clarifications, please feel free to write info@aceducation.ph.

Sincerely,

Fred Ayala

UNC Vice Chairman

I am very pleased, to share with you that we have recruited Dr. Fay Lauraya to take my place as President of UNC. I will be stepping down as President of the University of Nueva Caceres (UNC) effective today, July 30, 2018, so that I can focus on key strategic initiatives of AC Education, including the development of our newly acquired National Teachers College, and the

merger of AC Education with iPeople, the listed education company that owns Mapua University.

Fay was the seventh President of Bicol University (BU), where she served two terms from 2007 to 2015, and which she helped lead to excellence on many fronts. At BU, one of the largest sues in the country, she transformed the institution to be the one of the best performing in terms of licensure exams, and maintained its SUC Level IV status, the highest possible accreditation level for SUCs. She also grew the student population from just over 16,000 to nearly 25,000 students, led BU to its ISO 9001-2008 certification, and rehabilitated the school after it was severely damaged by typhoons "Milenyo" and "Reming" in late 2006.

Because of her successes at BU, CHED sought Fay's assistance to serve as the Lead for Institutional Development and Innovation Grants, where she helped universities around the country to build their capacities for quality teaching, research and extension, especially those impacted by the K-12 transition.

UNIVERSITY OF NUEVA CACERES ·

City of Naga, Philippines

OFFICE OF THE PRESIDENT

We are fortunate to have Fay join us at UNC, as she is an accomplished and proven leader who has a track record of engaging with and empowering both staff and students, introducing innovative new programs, and investing in employee development and a merit based promotion system. Very importantly, she shares our values and our passion for delivering affordable, accessible, high quality education to the Bicol region.

I am very grateful for the opportunity to have worked with many of you over the past 3 years. Together, we have spearheaded key initiatives and po$itive changes in the university, such a~ the introduction of numerous Student Value Adds (e.g. Professional Employment Program, LINC Senior High School, English Immersion Environment and Flipped Classrooms), and the improvement of our employee benefits, student experience, facilities, brand and operational efficiencies, among others. We also collectively achieved healthy enrollment growth from 7,358 in SY 15-16 to 8,507 in the first semester of SY 18-19, despite the impact of K-12, which has caused many other universities to shrink in size.

While I will no longer oversee day-to-day operations, I will continue to play an active role on UNC's Board as Vice-Chairman, and will continue to visit UNC regularly. In particular, I will work closely with Fay to continue our progress with our Rockefeller Habits OPSP, our campus master development plan, and the strategic alignment of UNC with the initiatives of AC Education.

I would like to thank the UNC community for allowing me to journey with you the past 3 years. It has been an honor to serve as UNC's President and to work with you to help

make the founders' vision a reality. I would also like to thank each of you for supporting us as we work hard to deliver our Brand Promise, that "You Will Make It, In a Nurturing Environment.

In closing, I would like to congratulate Fay on her appointment, and to wish her all the

best in her new role as President. I am confident in Fay's ability to lead UNC in its next

chapter. Let us all support Fay as she leads us closer to our goal of being the number

one university in Bicol.

If you should have any questions about our transition, please address them to

info@aceducation.ph.

Sin~

Fred Ayala

Vice-Chairman