Monday, 27 March 2017, 21:31 HKT/SGT

Wastewater Treatment Industry Is Expected to Grow Faster

HONG KONG, Mar 27, 2017 - (ACN Newswire) - Kunming Dianchi Water Treatment Company Limited ("Dianchi Water Treatment"), the leading municipal wastewater treatment and reclaimed water supply services provider in Yunnan Province, the PRC, targets to go listing of its shares on the Main Board of The Stock Exchange of Hong Kong Limited on April 6.

Dianchi Water Treatment plans to offer an aggregate of 339,430,000 H shares (comprising 308,572,000 H Shares to be offered by the Company and 30,858,000 Sale Shares to be offered by the Selling Shareholders, subject to the Over-allotment Option), at an offer price range between HK$3.91 per H share and HK$4.70 per H share. The Hong Kong public offering will close at 12:00 noon on March 29, 2017, Thursday. Dealings in shares on the SEHK are expected to commence on April 6, 2017, Thursday, with the stock code 3768 in board lots of 1,000 H shares each. There is an over-allotment option to increase the offering size by 15% of the number of Offer Shares, an aggregate amount of 50,914,000 additional shares.

Morgan Stanley Asia Limited is the Sole Sponsor of this proposed listing. Morgan Stanley Asia Limited, China International Capital Corporation Hong Kong Securities Limited, Haitong International Securities Company Limited and Zhongtai International Securities Limited are Joint Global Coordinators, while Morgan Stanley Asia Limited (in relation to the Hong Kong Public Offering only), Morgan Stanley & Co. International plc (in relation to the International Offering only), China International Capital Corporation Hong Kong Securities Limited, Haitong International Securities Company Limited, Zhongtai International Securities Limited, Huatai Financial Holdings (Hong Kong) Limited, GF Securities (Hong Kong) Brokerage Limited, CCB International Capital Limited, BOCI Asia Limited, CMB International Capital Limited, Guotai Junan Securities (Hong Kong) Limited, China Everbright Securities (HK) Limited are Joint Bookrunners and Joint Lead Managers of this proposed listing. ZMF Asset Management Limited and Sinomax Securities Limited are the Joint Lead Managers of this proposed listing.

Dianchi Water has entered into cornerstone investment agreements with Kunming Industrial Development, Yunnan Provincial Investment Holdings Group Co., Ltd., Beijing Enterprises Water Group Limited and China Water Environment Group Limited to subscribe the Company's shares at an aggregate amount of up to US$95.3 million. Assuming an Offer Price of HK$4.31 (being the mid-end of the Offer Price range), their total subscribed shares are equivalent to up to 171,803,000 Offer Shares, representing approximately 50.6% of the issued share capital of the Company upon completion of the Global Offering (assuming that the Over-allotment Option is not exercised) or 16.7% of the Shares in issue upon the completion of the Global Offering, assuming no exercise of the Over-allotment Option.

The Leading Municipal Wastewater Treatment and Reclaimed Water Supply Services Provider in Yunnan with a Strong Track Record of Expansion

Dianchi Water Treatment is a leading municipal wastewater treatment and reclaimed water supply services provider in Yunnan Province, a provider of integrated water-related services including running water supply service and a core enterprises implementing the PRC's strategic goal to treat pollutants at Dianchi Lake. The Company enjoys exclusive rights to provide wastewater treatment services in Kunming and some other parts of the PRC and remarkable competitive advantages in the wastewater treatment industry. As of March 16, 2017, the Company had a total of 34 plants under concession agreements, of which 29 were in operation, 2 were under construction and 3 were under development (two of them are located in Laos). Moreover, the Company had a total of 26 wastewater treatment plants in operation, with a total wastewater treatment capacity of 1.6 million m3 per day. Revenue from wastewater treatment service accounted for 83.7% of the total revenue for the year of 2016.

As of December 31, 2015, Dianchi Water Treatment ranked first in Yunnan Province, in terms of municipal wastewater treatment capacity, accounting for 34.0% of the designed municipal wastewater treatment capacities and 45.1% of the actual volume of wastewater treated in the province. Also, according to Frost & Sullivan, the Company ranked the first in Kunming City, in terms of municipal wastewater treatment capacity, accounting for 94.4% of the designed municipal wastewater treatment capacities in Kunming. Being an industry leader in effluent quality and energy efficiency in Yunnan Province, the Company has participated in setting the provincial industry standards for wastewater treatment services. As of December 31, 2016, 93.7% of the Company's designed wastewater treatment capacity reached the National Class I Standard A, which is the highest national standard for wastewater treatment. The Company intends to further improve pollution reduction capability and to assist local governments and other potential clients in meeting their pollution treatment requirements, thereby enhancing reputation and increasing market share of the Company.

IN past few years, through the acquisition activities, the business of the Company expanded into new areas such as the Guizhou, Anhui, Zhejiang and Jiangsu Provinces, as well as Laos.

As of December 31, 2016, the Company also had a total of 6 wastewater treatment plants capable of producing reclaimed water with an aggregate supply capacity of 44,000 m3 per day while it has 3 running water plants in operation in Yunan Province, one plant under construction and one under development in Yunnan Province, and one plant under development in Laos.

Topic: Press release summary Sectors: Daily Finance, Daily News
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