CITIC Environment Protection Investment President Webber Hao will be appointed as UEL's non-executive chairman post merger.
Photo by Ngo Yit SungCHINA’S LARGEST conglomerate CITIC is committed to making United Envirotech (UEL) a PRC bellwether in water and wastewater treatment, riding on government policy to develop the sector and improve water quality in the country.
By market capitalisation, UEL currently is not up there yet with its S$1.6 billion value, compared with about S$2.5 billion for China Everbright Water and about S$10 billion for Hong Kong-listed Beijing Enterprises Water Group.
CITIC’S commitment to grow UEL is evidenced by its capital injection of more than S$800 million into CITIC Environment Investment Group this year, according to CITIC spokesman Webber Hao.
Mr Hao, who is President of CITIC’S water and wastewater business platform, CITIC Environment Investment Group, was speaking at a media briefing in Singapore on Wednesday.
CITIC Environment Investment Group became UEL’s controlling shareholder on 1 April, with an interest of 60.24% in UEL jointly held with KKR China Water Investment Holdings.
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With CITIC’S financial muscle as backing, UEL has committed to a spate of projects with total investment cost amounting to over half a billion Singapore dollars (Rmb 2.4 billion) in the past half a year. |
UEL founder Dr Lin Yu Cheng (left) and Memstar founder Dr Ge Hailin (right), are membrane technology experts in the UEL group that made the industrial wastewater treatment specialist very attractive to CITIC as an acquisition target.
NextInsight file photo CITIC intends to retain UEL’s SGX listing status and management continuity. UEL founder, Dr Lin Yucheng, will remain on board as CEO.
On Thursday, Maybank Kim Eng analyst Wei Bin maintained his ‘Buy’ call on UEL with a target price of S$1.93.
This translates into a 17% upside based on the stock's closing price of S$1.65 on Thursday.
Mr Wei believes UEL can enjoy synergies from CITIC's other businesses and the new parent company will lower its funding costs.
CITIC'S general offer to acquire UEL shares at S$1.65 each closes next Thursday (16 April).
