Slaughter and May has advised China Power International Development on a RMB27.7 billion (USD3.8 billion) group asset restructuring, which includes the acquisition of SPIC Yuanda Environmental Protection, for which Zhongzi Law Office served as legal adviser.
Benita Yu and Justin Chan led the Slaughter and May team on the transaction. Commerce & Finance Law Offices acted for China International Capital Corporation, the independent financial adviser on the transaction.
As part of the transaction, China Power will transfer its interests in two subsidiaries —Wu Ling Power Corporation and SPIC Guangxi Changzhou Hydropower Development —to Yuanda Environmental.
The total deal, valued at RMB27.7 billion (USD3.8 billion), will be settled by Yuanda Environmental through a combination of share issuances and cash payments.
Incorporated in Hong Kong and listed on the HKEX, China Power is a core subsidiary of State Power Investment Corporation (SPIC), one of the largest state-owned power generators in China. Yuanda Environmental, another entity within the same group and listed on the SSE, primarily focuses on environmental protection, energy conservation and water management.
On completion of the asset restructuring, the China Power group will hold a 55.13% equity interest in Yuanda Environmental, which will be consolidated into its financial statements. Wu Ling Power and Changzhou Hydropower will remain subsidiaries of China Power through its ownership in Yuanda Environmental.
The asset restructuring allows China Power to become the controlling shareholder of Yuanda Environmental and integrate its hydropower assets into a specialised platform. This move strengthens China Power’s complementary positioning of its multi-source power generation portfolio, while fully capitalising on the synergies between its environmental protection and clean thermal power businesses.
