C&G’S SYNTHETIC fiber business will be hived off for between US$49m-US$58 m, said the company yesterday, citing the textile sector’s challenging operating environment as the push factor.
Instead, it will now focus on its newly acquired waste-to-energy business, which is in a fast-growing sector that is strongly supported by China’s government.
C&G’s waste-to-energy business unit, C&G Environmental Protection International Limited, currently has 9 BOT (Built, Operate and Transfer) projects in its portfolio.
Based on its secured capacity, C&G EPIL would be one of the top three WTE operators in the PRC, with an annual treatment capacity of 3.3 million tons.
Last year, China for the first time surpassed the U.S. to become the top investor in clean energy, according to a recent study by Pew Charitable Trust.
In the past five years, China’s clean-energy investment has surged 148% to reach US$34.6 billion in 2009, or 30.5% of the industry’s investment by G-20 nations.
Ongoing priority for energy security, global warming pollution reduction and job creation will drive investments up 25% to a record US$200 billion in 2010, according to Bloomberg New Energy Finance forecasts.
China, for example, plans to get 15% of its energy from renewable sources by the end of 2020. It aims to spend 34% of its 4-trillion yuan stimulus package on green projects.
Waste-to-energy offers greater earnings visibility and better return-on-investment, according to C&G CEO Cai Junyi in a press statement.
C&G has entered into an MOU to sell its PET chips and yarn production business for about US$49 million to US$58 million.
Proceeds from the sale will be channeled to its waste-to-energy business, which will start contributing to group revenues this year.
”Staying ahead in the textile sector requires substantial investment, which would be risky given the current economic climate,” said the CEO.
Related story: C&G: To be among top 3 in China’s waste-to-energy treatment
