IFC to finance $248m Chinese wind projects

The World Bank affiliate will provide a $30m convertible loan to a private developer in China to build 200MW of capacity in Henan.

Concord New Energy, a Chinese privately owned renewables developer, has secured a convertible loan of around HK$234 million ($29.9 million; €24.9 million) from the International Finance Corporation to fund new projects.

The financing will support construction of two utility-scale wind farms of 100MW each, located in Henan Province, with an aggregate project cost of $248 million.

The convertible loan consists of three tranches of financing, the first of which sets a conversion price of HK$0.5 per share. This represented a premium of 47.06 percent at the date of agreement on 28 December, Concord said in a filing at Hong Kong Stock Exchange. The second tranche will be priced at HK$0.55 per share, with the last tranche at HK$0.6.

Should the loan be converted, the transaction will represent around 4.74 percent of the issued share capital of the company as enlarged by the allotment and issue of the conversion shares. IFC will therefore own a 5.85 percent stake in the company, combining its current 1.17 percent shareholding.

Concord is currently 26.64 percent owned by China Wind Power Investment Limited, which is 47.78 percent owned by Concord’s chairman Liu Shunxing. Chinese renewables power producer Huadian Fuxin owns 10.14 percent of Concord and the remainder is held by other public shareholders, which account for less than 5 percent each.

The company implements the “build-and-sell” business model, which helps deliver “a continuous growth in the profit owing to the substantial increase of project from project disposal”, said Concord in its latest interim report.

As of June 2017, the Chinese renewables developer owned and operated 40 wind projects with around 1.2GW of attributive capacity, and 17 solar projects with around 300MW of attributive capacity. It has a development pipeline of more than 28GW in wind and 8GW in solar.