United Envirotech expands wastewater treatment portfolio with acquisition of 2 plants for RMB116 million

Jul 05, 2012

Mainboard-listed United Envirotech Ltd., a leading membrane-based water and wastewater treatment solutions provider, has signed a sales and purchase agreement to acquire an 80% stake in Fujian Liyang Envirogroup Co. Ltd and Shaxian Lanfang Water Co. Ltd for RMB116 million (approx. S$23.2 million).

The acquisition will allow the group to own and operate 2 wastewater treatment plants in Fuqing and Shaxian City, Fujian Province with a current combined aggregate capacity of 150,000 m³/day. Following the completion of phase 2 construction of Shaxian Wastewater Treatment Plant, the total treatment capacity would increase to 180,000 m³/day.
 
Chairman and Chief Executive Officer of United Envirotech, Dr. Lin Yucheng, elaborates on the acquisition: “We are pleased with our acquisition of the 2 wastewater treatment plants as it adds around 150,000 m³/day of operating capacity to our current portfolio. It also signifies our expansion into new regions in China as this will be our first investment in the Fujian Province.
 
In line with the government’s plans to increase wastewater treatment capacity and utilisation of existing facilities under China’s 12th Five Year Plan, the Group will continue to aggressively pursue opportunities to further expand our market share and recurring income base.”
 
The Group announced in March 2012 that it has signed a sales and purchase agreement to acquire 2 plants which supplies industrial water and provides treatment of textile industrial wastewater in Shandong Province. The Group will upgrade the existing wastewater treatment plant using its advanced membrane bioreactor (MBR) technology.
 
Commenting on the Shandong acquisition, Dr. Lin said: “As the market leader in industrial wastewater MBR technology, we are also pursuing engineering projects that capitalise on our technological strength and our established track record particularly in the chemical and petrochemical sector. We will continue to adopt this “Twin Engine” approach to drive our growth.”
 
The acquisition will be funded by a combination of bank borrowings and proceeds from the last KKR convertible bond issuance.

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