By P.R. Venkat
SINGAPORE--A unit of state-owned Chinese firm Citic Ltd. and
U.S. private-equity firm KKR & Co. Thursday made a formal offer
to buy a Singapore wastewater-treatment company in a deal valuing
the company at 1.9 billion Singapore dollars (US$1.4 billion).
Citic Environment (International) Co. and KKR announced in
November last year that they are forming a joint-venture to buy
United Envirotech Ltd., but a formal offer was to be made after
certain regulatory approvals including that from the Chinese
government authorities.
In a filing to the Singapore Exchange, Rothschild (Singapore)
Ltd., the financial advisor to the joint venture company said that
"all offer pre-conditions have been satisfied."
United Envirotech provides engineering services for
water-treatment systems and has clients such as state-owned firms
China Petrochemical Corp., or Sinopec; China National Petroleum
Corp. and China National Offshore Oil Corp. Most of United
Envirotech's businesses are in China.
KKR, which currently owns about a 29.65% stake in United
Envirotech, will sell its shares to the joint-venture company,
which will eventually be majority-owned by Citic Environment. Apart
from the share stake, KKR owns convertible bonds of United
Envirotech, which if converted into shares, would amount to about
10.23%. United Envirotech's chief executive and chief investment
officer, who together own a 16.33% stake in the Singapore-listed
company, have agreed to support the deal and join the joint
venture.
The statement said that the joint venture company currently owns
or has got "irrevocable undertakings" for nearly 51% of United
Envirotech shares.
The joint venture company is offering to pay S$1.65 for every
United Envirotech shares and doesn't intend to raise its offer
price.
Shares of United Envriotech are currently on trading halt and
they were last at S$1.620 on Tuesday.
Write to P.R. Venkat at venkat.pr@dowjones.com
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