Mayer Brown JSM has recently acted for Waste Resources GP as the investor in an issue of HK$156 million zero-coupon guaranteed convertible bonds and new shares by New Environmental Energy Holdings. The proceeds from the offering will contribute to the development, construction and operation of seven waste-to-energy incineration plants in Beijing, Shanghai, Nanchang, Guangzhou, Nanjing and Shenzhen.
Hong Kong Stock Exchange-listed New Environmental Energy Holdings was formerly known as Hembly International Holdings. In its old guise, it was principally engaged in the manufacturing and sales of clothing and accessories, and the distribution and retailing of clothing and footwear. The company had been seeking opportunities to diversify its business as a response to the poor recent economic climate. It deemed the waste treatment, renewable energy and services sector to be an area worthy of exploration, given increasing global environmental awareness, supportive government policies around the world and the various traditional energy-related crises.
The waste incineration technology used by the company involves the combustion of municipal solid waste, converting it into bottom ash, flue gases, particulates and heat, which can in turn be used to generate electric power. The flue gases are cleaned of pollutants before they are dispersed into the atmosphere.
Under China’s 11th Five-Year Plan, it is expected that 0.5 gigawatts of electricity will be generated from waste-to-energy technology, growing to 3.3 gigawatts by 2020. The PRC Renewable Energy Law was passed in 2005 and states that it is a national and public obligation to transform waste to energy.
Waste Resources GP acted as general partner for and on behalf of Waste Resources Fund LP, which is an exempted limited partnership established in the Cayman Islands and managed by FourWinds Capital Management, an asset manager established to invest in global natural resources, water and environmental opportunities. Waste Resources Fund LP invests in industrial, urban and rural waste processing with a focus on high growth markets.
