Beijing company set to take over German incinerator group

Beijing Enterprises Group Co, the State-owned investment firm, suspended trade in its stocks on Thursday in Hong Kong after reports it had won a bid to buy EEW Energy from Waste, a major German garbage-incineration power plant operator.


The Wall Street Journal said Beijing Enterprises had outbid several others to acquire EEW from private-equity firm EQT Partners for 1.8 billion euros ($2 billion).


The companies could not be reached for comment.


EQT put EEW up for sale last summer. The German company runs 19 plants supplying electricity, regional heat and industrial steam.


EEW's latest figures showed it turned 4.9 million metric tons of garbage into 1,900 gigawatt hours of electricity and 3,000 gW hours of heat in 2014, which generated revenue of 539 million euros. Its statistics for last year are yet to be released.


If successful, it will be the biggest takeover of a German company by a Chinese company, and follows the $1 billion deal by China National Chemical Corp with German plastic equipment manufacturer KraussMaffei in January.


Beijing Enterprises shares closed at HK$38.05 ($4.89) on Wednesday, down 19 percent from the beginning of January. The Beijing company has an investment portfolio spanning gas supplies, beer and waste water treatment.


According to Reuters, the group of bidders in the final round included waste-to-energy operator China Tianying Inc, a consortium including the Chinese financial investor Beijing Capital Group Co, a group made up of German utility Steag Energy Services GmbH and the Australian financial investor Macquarie Group Ltd, and Fortum Oyj, the Finnish energy company.


Guo Yungao, director of the power generation department at the China Association of Circular Economy, told a recent conference on waste-to-energy that most Chinese garbage is buried.


"But burying garbage results in pollution of underground water. If it could be used for power generation, it could save up to 50 to 60 million tons of coal every year," Guo said.


The article transsshipment from China Daily