HK BLDG & LOAN acquiring Weldtech at a price of 2.8 billion(sina.com-Finance)
February 28, 2011
Finance.sina, Feb 28: HK Building and Loan Agency Limited published acquisition of Weldtech at a price of 2.8 billion.
HK BLDG & LOAN disclosed that 231 million of the acquisition price was paid in cash, 165 million in convertible notes at a rate of 0.16 per share; 319 million in acceptance bills (within 10 years, zero interest rate in the first three years, 0.3 % interest rate from the fourth year to maturity), and the rest 600 million by issuing 3.75 million consideration shares at a price of 0.16 per share.
Both conversion price and issue price per share are 0.18, equivalent to 19.2% discount against pre-suspension closing price of 0.198. The percent of consideration shares to current equity and to expanded issued capital is 93.7% and 26.8%, respectively.
The assigner expressed that Weldtech would provide energy monitoring and energy efficiency solutions for retail buildings, industrial buildings, shopping malls, hospitals and urban infrastructures; its proprietary UPPC system and other equipments would reduce energy consumption and improve the overall energy efficiency of central air conditioning system.
This stock applied for trade resumption this morning.
Click here: http://finance.sina.com.cn/stock/hkstock/ggscyd/20110228/09449442518.shtml
It is expected that national policies will boost the development of China energy conservation market and encourage reduction of energy consumption. Report from Frost and Sullivan estimated that the market demand on optimized chiller sets in 2009 would rise up to 318 billion and 1.666 trillion in 2021 at a CAGR of 14.8%. Energy conservation is an important part in the Outline of the 12th Five Year Plan and one of the seven emerging industries which would drive the growth of the gross market value up to 3.4 trillion. Opinions of NDRC and the Ministry of Finance concerning acceleration of EMC promotion to encourage energy conservation service industry specifies encouraging “energy conservation service providers” with subsidies and tax exemption. By the end of 2010, Ritao Trading (Shanghai) Co., Ltd wholly-owned by Weldtech has been certified as Energy Conservation Service Provider by Shanghai EMC Steering Committee.
This M&A opens the door for HK BLDG & LOAN to advance into high-pace growing energy administration industry of China. As a wholly-owned subsidiary of HK BLDG & LOAN, Weldtech will, under the leadership of HK BLDG & LOAN, make best endeavor to promote our self-developed ultra-performance control system (UPPC) and EMC. Except expanding China and foreign markets, we will constantly seek the channel and funding support from HK BLDG & LOAN so as to create a solid foundation for deeper exploration of independent R&D, provision of energy monitoring and energy efficiency solutions for retail, industrial properties, shopping malls and hospitals, as well as the marketing of UPPC system and EMC.
