Climate change has had an adverse effect on the environment. With glaciers shrinking, trees flowering sooner and plant and animal ranges shifting; it is high time for everyone to think about their carbon footprints. Various organizations and countries have signed agreements to reduce their respective carbon emissions, in an effort to fight climate change.
SIIC Environment Holdings is one such organization that is aggressively working on waste management and developing energy from renewable sources among others, which will help in reducing the global carbon emissions. Recently SIIC formed a new joint venture (JV) firm with Baowu Environment with a registered capital of 1.1 billion yuan which is S$198.9 million.
Reportedly, Baowu Environment is an independent third party environmental pollution treatment firm that is a division of the China Baowu Steel Group Corporation.
According to reliable sources, the new venture would be known as Shanghai SIIC Baojin'gang Environmental Resources Tech Co Ltd. The new JV company’s business activities would include waste management, the sale and processing of slag products and power generation.
Additionally, the JV intends to allow SIIC to grow its WTE (waste-to-energy) business and discover potential waste-to-energy business prospects in Shanghai. The venture will also let the firm to better cater to urban industrial zones in functional escalation and transition.
The JV was formed through the group’s indirectly-owned business unit, SIIC Yangtze Delta. The deal would see the unit acquire a 60% equity worth 660 million yuan. Baowu Environment, meanwhile, would acquire the remaining 40% stake in the JV, worth 440 million yuan.
SIIC Environment commented that it believes the deal is fair and reasonable and inked on normal commercial terms.
The firm recently made headline when it announced that it has signed a deal for concession rights for its Dalian city’s Dalian Wan Wastewater Treatment Plant project concerning water tariff surge in China. The facility boasts of a cumulative design capacity of over 40,000 tons per day.
Meanwhile, Fudan Water Engineering and Technology Co, a division of SIIC, also inked a supplementary deal on concession rights for its 90,000 tons per day Ningbo Hangzhouwan New District Wastewater Treatment Plant Project.
The JV deal is not anticipated to show any material effect on the group’s earnings per share or on its net tangible assets in this fiscal year.
Source Credit: https://www.straitstimes.com/business/companies-markets/siic-environment-sets-up-199m-joint-venture-for-waste-to-energy-business