(Hong Kong, 6November 2016) Boer Power Holdings Limited (“Boer Power” or the “Company”; Stock Code: 1685.HK), a leading solutions provider for intelligent electrical distribution systems and energy efficiency management in China, is pleased to announcethat Boer Power entered into a strategic cooperation agreement (the “Strategic Cooperation Agreement”) with Shanghai Galaxy Investment Co, Ltd (“Shanghai Galaxy”), a subsidiary of Shanghai Industrial Investment (Holdings) Company Limited (“SIIC”), with an intentionto engage inthe development, investment and construction of the photovoltaic (“PV”) power stations and rooftop distributed power stations project in China with a total estimated installed capacity of 100MW. Upon establishement, the Company will sell power stations to Shanghai Galaxy, provide operation and maintenance services for all thesold power stations.The Strategic Cooperation Agreement shall remain in effect through an initial term of three years from the date of the Strategic Cooperation Agreement and shall automatically extend for one year upon expiry of the initial term.Pursuant to the Strategic Cooperation Agreement, Shanghai Galaxy intends to acquire most of the PV power station assets currently held by the Company at a total estimated transaction amount of approximately RMB200 million to RMB300 million (equivalent to approximately HK$229.9 million to HK$344.8 million).
The acquisition mentioned above is currently proceeding. In furtherance of the Strategic Cooperation Agreement, Shanghai Galaxy entered into an equity transfer agreement with the Companyto purchase 80.1% equity interest in Gannan Longyang New Energy Co., Ltd., a subsidiary of Bower Power, at the consideration of RMB 41,652,000 (equivalent to approximately HK$ 47,875,862).
SIIC, wholly owned by Shanghai Municipal State-owned Assets Supervision and Administration Commission, is the largest overseas conglomerate enterprise under the Shanghai municipal government and is mainly engaged in four pillar industries of real estate, medicine, infrastructure and consumer products. SIIC is also the controlling shareholders of Shanghai Industrial Holdings Limited, a Hong Kong-listed Company (Stock Code: 363.HK).
Mr. Qian Yixiang, Chairman and CEO of Boer Power said, “We belive it will be a definite win-win cooperation for both sides. The Company foresaw opportunities and took preemptive action to enterthePV market. We have accumulated rich experience in the construction, operation and maintenance of the PV power stations over the years and have the appropriate electric power assets to satisfy SIIC, which intends to expand its electic power assets. Strategic cooperating with SIIC represents Boer Power’s comprehensive strength in the the construction, operation and maintenance of the PV power stations. It is believed that the cooperation not only favors with enhancing the Company’s sales revenue and cash flow, but also is a new attempt to further expand its PV business. Partnering with SIIC is the Company’s maiden attempt on build-transfer (BT) model. We regard it as an important opportunity to gain our practical experience and believe it will do ourPV business no end of good.”
“China has reached 13 GW of newly installed solar capacity in the first half of 2016, achieving approximately 80% of the target for the year, equivalent to 26% of 50GW of new capacity additionsworldwidelast year.China’sPV market is fast growing and shows high growth potential. Looking forward, we will continue to seize the opportunities created by the blooming domesticPV market and seek strategic cooperation with SIIC and other conglomerate enterprisesto further expand our PV business, with an aim to improve our profitability and comprehensive competitiveness.”