KKR in $40m Chinese water treatment firm deal

The US private equity firm has agreed to make a common equity investment in China’s United Envirotech Limited. The latter operates a portfolio of waste water treatment plants across China.

Kohlberg Kravis Roberts & Company (KKR), the US private equity firm, has boosted its investment in Chinese water treatment firm United Envirotech Limited (UEL), both companies announced in a statement.

KKR has agreed on a $40 million common equity investment with UEL at an offer price of S$0.50 (€0.31; $0.41) per share, an 8.5 percent premium to UEL’s S$0.46 average 30-day share price. The equity raised will be used to fund the acquisition of water treatment plants, upgrade existing plants and help fund the Chinese firm’s working capital.

Last October, KKR subscribed to $114 million of convertible bonds issued by UEL to support the company’s expansion.

UEL operates a portfolio of waste water treatment plants across China and provides engineering services to municipal and industrial waste water treatment projects, the partners said in the statement.

“We are delighted to have KKR continue to invest in UEL to support our strong growth. It is a clear indication that KKR is satisfied with UEL’s performance and is very confident in our growth potential,” stated Dr. Lin Yucheng, chairman and chief executive of UEL.

The transaction is set to close by March.