CHC Provides Update on Possible Acquisition of 3 Hydroelectric Projects in Yunnan Province2010-02-16, PR Newswire, New York, USA
China Hydroelectric Corporation ("China Hydroelectric" or the "Company"), a consolidator, developer and operator of small hydroelectric power projects in the People's Republic of China ("PRC"), today announced that it has executed a definitive agreement to acquire a 44 megawatt operating hydroelectric project in Yunnan province in the People's Republic of China. In addition, the Company announced that it has also entered into memoranda of understandings to acquire two additional operating hydroelectric power projects aggregating 34 megawatts in Yunnan province. Together with the definitive agreement, these memoranda present the Company with the opportunity to acquire an additional 78 megawatts of generating capacity in Yunnan province.
The definitive agreement provides for the Company to acquire the Xiaopengzu project in Yunnan province for a purchase price of US $57 million (RMB 390 million), to be financed partially through cash on hand and through the assumption or refinancing of existing non-recourse debt. The acquisition is subject to customary closing conditions, including obtaining governmental approval.
The memoranda of understanding provide the Company with an exclusive right to pursue its due diligence of two additional operating hydroelectric projects in Yunnan. Subject to the satisfactory completion of its due diligence review, the Company expects to enter into definitive agreements to acquire these projects in the near term.
"We are pleased to be able to enter into the definitive agreement and the memoranda of understanding to acquire these three projects in Yunnan," said Chairman & CEO John D. Kuhns of China Hydroelectric Corporation. "Yunnan province, where we already own and operate 43 megawatts of capacity, presents an excellent opportunity to expand our asset base in China. Our ability to enter into definitive agreements and MOUs has accelerated as a result of our recently completed IPO. Completion of these transactions would represent Phase I of our plan to acquire approximately 250 megawatts of operating hydroelectric projects during the first half of 2010."
About China Hydroelectric Corporation
China Hydroelectric Corporation ("CHC" or the "Company") is a consolidator, developer and operator of small hydroelectric power projects in the People's Republic of China. Led by an international management team, the Company's primary business is to identify and evaluate acquisition and development opportunities and acquire, and in some cases construct, small hydroelectric power plants in China. China produces approximately 22% of its total energy from hydroelectric energy. The Company currently owns twelve operating hydropower projects in China with total installed capacity of 377 MW. These projects are located in four provinces: Zhejiang, Fujian, Yunnan and Sichuan. In addition, CHC recently expanded operations through the acquisition, pending government approval, of development rights to a 1,000 MW pumped storage hydropower plant in Henan.