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Business / Companies

Datang Environment plans IPO

By LYU CHANG (China Daily) Updated: 2016-08-26 08:22

Datang Environment Industry Group Co Ltd, a unit of the State-owned China Datang Group, said it plans to list its shares in Hong Kong next month.

Given the country's push for clean air, the company said it believes the time is appropriate.

Shen Zhen, vice-general manager of Datang Environment, said it was looking at an initial public offering in Hong Kong last year, but the timing seemed bad since Hong Kong stocks were then entering a bear market.

"We are fully prepared now, with completion of the due diligence investigation," he said.

The Beijing-based company, which is the energy conservation and environmental protection arm of China Datang, helps coal-fired power plants reduce their emissions and pollution. China Datang is one of the five major power generation enterprises,

Shen said the company will use the money raised in the IPO to install pollution control systems for newly built coal-burning power plants. It will also purchase such equipment for the existing coal-fired power plants.

"Apart from operation of projects to reduce emissions such as sulfur dioxide and nitrogen oxide, we are expanding our energy-saving and water treatment businesses at the same time," he said, without giving more details on the scale of financing.

The move came as China rolled out new emissions standards for power plants in 2014, which are in some cases even stricter than current standards in the European Union and the United States.

In some regions such as Beijing, Tianjin, Shanghai and Guangdong province, all existing and new coal-fired power plants will have to achieve emission limit values for SO2, NOx and PM to 50, 35 and 5 milligrams per cubic meter, respectively, by 2020, according to the general regulation. The standard is the highest in the world followed by Japan, Europe and the US, experts said.

Wang Changqing, general manager of the environmental protection unit at Datang Environment, said that the potential size of the country's market for SO2 and NOx emission reduction could reach about 300 billion yuan ($45.1 billion).

"Although it will be in a very competitive market, we are very confident about our clean technologies," he said. "We are using the emissions control equipment not only for our own plants, but also those in other companies."

The company signed strategic cooperation agreements with Shanghai Electric Corporation and Harbin Electric Corporation to jointly develop the overseas market for coal-fired plant pollutant control.

Shen said the Belt and Road Initiative provides huge opportunities for Datang as many countries along the Silk Road Economic Belt and the 21st Century Maritime Silk Road have growing demand for less pollution and cleaner air.

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