China Merchants Group’s United PV and Huabei Expressway Join Again to Acquire 40MW Solar Power Plant in Kezuohouqi, Inner Mongolia
Time:2014-08-19

Hong Kong, China, 19 August 2014 - United Photovoltaics Group Limited (“United PV” or the “Company,” stock code: 00686.HK, whose largest shareholder is China Merchants New Energy Group “CMNE”), a leading solar power plant investor and operator in China, was pleased to announce today that the Company and Huabei Expressway Co., Ltd. (“Huabei Expressway”, 000916.SZ), a listed company under China Merchants Group, again intended to jointly acquire 93.68% of the equity interest in Guodian Kezuohouqi Photovoltaics Company Limited (“Guodian Kezuohouqi”) for a total consideration of RMB74.94 million (equivalent to approximately HK$94.43 million). Guodian Kezuohouqi owns a solar power plant with a total installed capacity of approximately 40MW in Keerqinzuoyihouqi (“Kezuohouqi”), Inner Mongolia. 


Connected to grid at the end of December 2013, the power plant has entered into a power purchase and sale agreement with State Grid East Inner Mongolia Electric Power Company with a feed-in tariff of RMB1 per kWh. Benefited by the high light intensity in Inner Mongolia and abundant solar power resources, the power plant is operating in good condition with high power generation efficiency. The power plant has average annual operating hours of approximately 1,455 and an average annual power generating volume of 58,210,000 kWh (20 year’s average). 


For the acquisition, the Company will invest RMB7.49 million (equivalent to approximately HK$9.44 million) for a shareholding of 9.37% and Huabei Expressway will invest RMB67.45 million (equivalent to approximately HK$84.98 million) for a shareholding of 84.31%. Upon completion of the acquisition, the Company and Huabei Expressway will inject capital to Guodian Kezuohouqi with reference to their respective shareholding in direct proportion, among which, the Company will invest RMB33.08 million (equivalent to approximately HK$41.68 million) and Huabei Expressway will invest RMB297.68 million (equivalent to approximately HK$375.08 million). Following the capital injection, the Company and Huabei Expressway will own 9.88% and 88.89% equity interest in Guodian Kezuohouqi respectively. By the end of the period of three years after the acquisition, the Company will be entitled to acquire the equity interest in Guodian Kezuohouqi owned by Huabei Expressway. 


Mr. Zhenwei LU, Executive Director of United PV, said: “This is another collaboration after the two companies’ successful joint acquisition for the 23.8MW solar agricultural and ecological project in Feng County, Xuzhou in 2013. In the future, both companies will leverage on their advantages and further strengthen the cooperation. In response to the ‘reformation strategy of energy production and consumption’ raised by China's President Xi Jinping in June this year, as a new energy company under China Merchants Group, we are committed to echoing the central government’s call for clean energy development. We will expand the solar power plant business, consolidate the resources of China Merchants Group and create a new business model with the combination of industry and finance.”


Mr. LU added: “After the acquisition, we will have 5 solar power plants in the Inner Mongolia Autonomous Region, with a total installed capacity of 235MW. It will facilitate the centralized management of solar power plants in the region, generate synergistic effects and lower unit operation and maintenance costs. In addition, backed by a series of robust state-owned enterprises in China, United PV is devoted to becoming a leading company in the solar power plant industry and leverage on its advantages in project, technology and capital. With the support of resources from China Merchants Group, we are confident to gather the experts, capital and partners, taking the leading position in the industry.”