The board of directors of China Water Affairs Group Co., Ltd. ("China Water Affairs" or "the Company¡¨; stock code: 0855.HK), the leading comprehensive water enterprise in China, is pleased to announce that on 11 January 2018, Henan Guoyuan Water Affairs Co., Ltd., a wholly-owned subsidiary of China Water Affairs, completed the acquisition of 100% equity interest in Wuzhi Minsheng Water Supply Co., Ltd.
Wuzhi County Minsheng Water Affairs Co. Ltd. is principally engaged in water supply in Wuzhi County, Henan Province, PRC. The Water Supply Company has been granted a concession to operate water supply until 2038. The daily water supply capacity of the Water Supply Company is approximately 20,000 tonnes.
The company had previously acquired a project with a daily water supply capacity of approximately 30,000 tonnes in the local market, using water from the national "South-to-North Water Diversion". With the cumulative success and a good reputation of the previous project, a foundation is laid for the successful acquisition this time. After the Acquisition, the combined daily water supply capacity of Henan Guoyuan Water Affairs Co., Ltd. in Wuzhi County will increase to approximately 50,000 tonnes. China Water Affairs believes that the Acquisition will further strengthen its water supply business in Henan Province, PRC by enhancing the Company's water supply capacity and achieving synergies.
The acquisition is the second water plant acquired by China Water Affairs in Wuzhi County, Henan Province. As both of the target water plants are located along the route of "South-to-North Water Diversion¡¨ project, this will be further benefited from the national policy on waterworks and opens up a new business horizon for the Company, as well as to promote local water market development.
Previously, Duan Chuanliang, chairman of the Company, expressed at the interim result announcement that China Water Affairs would continue with step-up efforts to detach from non-core businesses and the proceeds from disposal of non-core assets would be channeled to the provisions for expansion of mainstream business. While City water supply has always been the core water business of China Water Affairs, the Company will leverage on every profitable opportunities for development. China Water Affairs will ride on the trust from the government and the general public at large and its experience from operation and management accumulated through years of providing water services, as well as adhere to the rationale, "Excellence of the Highest Kind Resides in Water¡¨ and ¡§Returning Society with Benevolence", to proactively lay out in the water supply market on a nationwide scale. Meanwhile, the Company will strengthen internal management, accelerate the disposal of non-core assets with an aim to promoting the Group's core competitiveness and corporate value and to maximizing returns to shareholders.
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About China Water Affairs Group Limited
China Water Affairs Group Limited is principally engaged in city water supply, sewage treatment and drainage, and related value-added businesses in the PRC. Currently, the Group¡¦s businesses cover over 50 cities in 3 municipalities of Beijing, Tianjin and Chongqing, and in 13 provinces including Guangdong, Jiangxi, Henan, Jiangsu, Hubei, etc. With a well-established cooperative relationship with various local government authorities, the Group has positioned itself in a leading position in China¡¦s water industry.
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