MBK, Hudson exit China environment business to Beijing Enterprises

BEHL has bought a 92.7% interest in GSEI from the two private equity firms for an undisclosed sum, according to a regulatory filing. MBK invested in the company in December 2009 through its $1.6 billion MBK Partners II fund. It remained the majority owner when Hudson came on board in early 2012, taking a minority interest.

GSEI owns and operates a portfolio of 13 assets in locations such Beijing, Shanghai and Jiangsu province. Total water and waste water treatment capacity of 1.69 million tons per day, while sold waste treatment capacity is 2,540 tons per day. The company's flagship waste-to-energy project in Beijing is the largest single-line plant in Asia.

BEHL is a Hong Kong-listed conglomerate controlled by the Beijing municipal government. With assets spanning gas, water services, waste treatment and related environment services, and beer, its purpose is to provide capital, technology and expertise to support Beijing's development priorities.

BEHL's assets include the largest individual stake in Beijing Enterprises Water, which is involved in water treatment and the construction and servicing of related infrastructure. As of June 2014, its network of 234 sewage treatment plants, 61 water treatment plants, five reclaimed water plants and one desalination plant had a combined designed daily capacity of 18.2 million tons.

BEHL expects GSEI to benefit from a string of government policies promoting environmental protection, including the RMB2 trillion ($333 billion) water pollution prevention action plan, which state media has said is intended to reduce water pollution by 30-50%.

K.C. Kung, partner and Greater China head at MBK, said: "Since assuming ownership in 2009, we managed to build a successful partnership with GSEI and work with the company to grow its business. BEHL and GSEI have tremendous synergies in their businesses and business values, and we expect the acquisition, which is a landmark deal in environmental protection services industry, will continue to fuel the robust growth of GSEI with its new ownership structure."

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• Topics
• Exits
• Greater China
• Cleantech
• Cleantech
• China
• Exit
• Trade sale
• MBK Partners
• Hudson Clean Energy Partners