China Jinjiang Environment controlling shareholders to sell down stakes to Zhejiang Group

Hong Kong money-changer with yuan symbol signHong Kong money-changer with yuan symbol sign. Photo taken pre-Covid

China Jinjiang Environment’s controlling shareholders informed the company they planned to sell an around 29.79 percent stake to Zhejiang Energy and Zheneng Capital Holdings for 1.63 billion yuan (S$322.02 million or US$235.82 million).

The controlling shareholders, Dou Zhenggang, Wei Xuefeng and their daughter Jennifer Wei, will make the sale via their wholly owned company China Green Energy, China Jinjiang Environment said in a filing to SGX late Monday.

Zhejiang Energy and Zheneng Capital Holdings are controlled by Zhejiang Provincial Energy Group, a state-owned provincial energy company, the filing said.

“The company has been informed that the purchasers, as a large energy enterprise group in the PRC, have great financial strength, and the controlling shareholders believe that the entry of the purchasers as shareholders of the company will facilitate the financing and future
development of the group,” China Jinjiang Environment said in the statement.

China Jinjiang Environment pointed to two transactions — its issuance of US$200 million 6.0 percent senior notes due 2020 and its term loan facility agreement for US$200 million.

Because the proposed transaction will result in a change of control, that may trigger the need to offer to purchase all of the outstanding notes and repay the loan, the company said. But it added it was informed the purchases have taken the risk into consideration and would take “appropriate measures” to deal with the issues.

After the deal, Dou Zhenggang and Wei Xuefeng are expected to become the second largest shareholders of the company, with interests in an around 25.82 percent stake, the filing said.

The purchasers plan to nominate two executive directors to the board once the deal is complete, China Jinjiang Environment said.

China Jinjiang Environment noted that the information on the proposed deal was provided by the controlling shareholders and the purchasers, and the company has not independently verified it.

The deal is expected to be completed by 10 September, the filing said.

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