Salcon Bhd’s wholly owned subsidiary, Salcon Changzhou (HK) Co Ltd, has entered into a concession agreement and an asset transfer agreement with Changzhou City Tian Ning District Diao Zhuang Street Office and Changzhou Southeast Industrial Wastewater Treatment Plant respectively to acquire, upgrade, operate and maintain the Southeast Industrial Wastewater Treatment Plant (SIWTP).
In a statement yesterday, Salcon said the SIWTP and related facilities in Jiangsu Province, China was acquired on transfer-operate-transfer basis at an acquisition price of RM27.7mil.
“The acquisition is expected to contribute positively to the company’s future earnings and is estimated to generate total of RMB1bil (RM463.4mil) throughout the entire concession period,” Salcon said.
Salcon Changzhou (HK) Co Ltd, via a new China company to be formed, will upgrade, operate and maintain the plant during the 30 year-concession. “This acquisition marks Salcon’s first industrial wastewater plant in China where investment returns are much higher as compared with municipal water and wastewater projects,” executive director Datuk Eddy Leong Kok Wah said.
“This represents a diversification within our core water assets in China. We are very positive (about) the potential of this new business area due to the rapid industrialisation in China,” executive director Datuk Eddy Leong Kok Wah said.
