(Yicai Global) May 17 -- Anhui Shengyun Environment-Protection Group Co. plans to sell some of its domestic waste-to-energy plants as it looks to cut into the CNY629 million (USD99 million) in debts it has recently defaulted on.
Anhui Zhonghuan Environmental Protection Technology Co., which treats sewage and wastewater, has agreed to take over some or all orders for the incinerators, including those that are not yet built, under construction or complete, the seller said in a statement yesterday.
For projects in which the pair share equity, Zhonghuan will take over as general contractor for the engineering-procurement-construction deals and procure technical services from Shengyun. In others, Zhonghuan may opt to take over as the contractor or provide other services for the project.
Shengyun announced on May 10 that it was unable to repay millions worth of matured debts after a dismal first quarter. It had posted a CNY1.3 billion loss for the period, dwarfing the expected CNY258 million deficit and leading to China Cheng Xin International Credit Rating Co. swiftly downgrading its long-term rating to BBB- from AA- and placing it on a watch list for further changes.
Kao Xiaosheng, chairman and controller, resigned from the company early last month. The firm had sought to rapidly expand but the efforts went awry and internal shareholders ditched their stock before the losses were revealed.
Editor: James Boynton