China Everbright Water issues 120.7m new shares to IFC and RRJ

This could result in cheaper debt.

China Everbright Water, formerly Hankore Environment Tech Group, has issued 120.7m new shares to IFC, a member of the World Bank Group, and RRJ Capital, which is run by Goldman Sachs Group.

IFC has been issued 49.7m new shares while RRJ has been given 71m new shares at $0.94 apiece, representing a 9% discount to its last closing price.

According to Maybank Kim Eng, the deal could spell cheaper debt for China Everbright. IFC is an existing lender to the firm while RRJ is active in the water sector and is a minority shareholder of China Everbright International and SIIC.

“We view this deal positively. Given its strong balance sheet and low gearing, CEW is not in dire need of capital. But this deal could give it two strategic investors.Although the placement price is at a big discount, we think CEW could benefit from potentially cheaper debt from IFC to fund its future growth,” stated Maybank Kim Eng.