China Hydroelectric Corporation, an owner, developer and operator of small hydroelectric power projects in China, announced it has entered into a definitive agreement to acquire a controlling interest in a total of 55.4 MW of operating installed capacity in the Fujian province of China.
This acquisition is the first phase of the previously announced "Taiyu Projects" acquisition for a controlling interest in seven operating hydroelectric power projects, representing a total of 114.4 MW.
This first phase of the Taiyu Projects acquisition consists of controlling interest in the following five operating projects: a 74 percent interest in the Jinwei project (16 MW); a 74 percent interest in the Jintang project (11.6 MW); a 55 percent interest in the Jinlong project (10 MW); a 100 percent interest in the Qianling project (13 MW); and a 100 percent interest in the Dongguan project (4.8 MW). These five projects represent a combined total of 55.4 gross MW of the total of 114.4 gross MW for the Taiyu Projects.
The definitive agreement provides for China Hydroelectric to acquire this first phase for a purchase price of US$61.3 million (RMB 411 million). This acquisition, which is expected to be consummated shortly, is expected to be financed through cash on hand and bank financing. The consummation of the acquisition is subject to customary closing conditions, including, among other things, obtaining government approvals.
The company had announced the signing of the memorandum of understanding for this acquisition earlier in 2010. This first phase of the acquisition, if consummated, will represent an addition of 55.4 MW of gross operating installed capacity, or 43.7 MW of net installed capacity, increasing the company's total gross installed capacity to 548.8 MW, or 532.6 MW of net installed capacity.
In other news, CHC announced that the company has signed a definitive agreement to acquire a 100 percent interest in the Dazhaihe project, a 15-MW operating hydroelectric project in Yunnan province of China, for a purchase price of US$17.6 million.
Earlier in 2010, CHC completed the previously announced acquisition of 100 percent of the Minrui small hydroelectric projects totaling 55.5 MW of installed capacity in the Yunnan province.
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