China Communication and Construction Co. (CCCC) is the lead bidder for IDE Technologies Ltd., a leading Israel-based global desalination technology firm, with a $650-million non-binding offer, according to Israeli financial industry sources.
At least two other bidders have reportedly submitted preliminary offers but were not identified.
IDE holds a 50% stake in Israel’s three largest desalination plants along the country’s Mediterranean coast at Ashkelon, Hadera and Soreq— the latter, at 150 million cu meters per year of water produced, is the largest reverse-osmosis plant in the world.
The company has focused its efforts in recent years abroad, heavily involved in development of desalination plants in China, India, Chile and Australia.
In 2013, IDE, part of the team led by Poseidon Resources, won the tender to design the largest North American desalination plant, located in Carlsbad, Calif.; it will produce 54 million gallons per day of treated seawater. IDE also is the plant’s operator.
“A canny combination of state-of-the art energy-recovery technology with an external energy-offsetting program makes Carlsbad the first major infrastructure project in the state of California to completely neutralize its carbon footprint,” says industry publication Global Water Intelligence. “The carbon-offsetting program helped fund the regeneration of forest areas decimated by wildfires in 2007.” But the largest potential market for desalination plants remains the Arab world, which currently is off-limits for the Israel-based company.
“The acquisition of IDE by a foreign company is likely to lift the limitations [it] has faced in entering Arab and Islamic countries, which have traditionally accounted for about 60% of the desalination business,” said Chen Herzog, chief economist at BDO Consulting and an expert on infrastructure.
He added that, in the case of CCCC, IDE would benefit from an even greater position in the rapidly expanding China market, in which the Israeli company already has made some inroads, as well as other markets in which desalination is being considered due to growing water shortages.
The Chinese company has been active in recent years in the Israeli market in project construction, including tunnels and a rail line in the Haifa area in northern Israel.
IDE also has branched out into the water treatment field. In March, the Israeli company and its Indian partner, VA Tech Wabag Ltd., won a $100-million contract in Chennai for construction, maintenance and operation of a 45-million-liter-per-day tertiary water treatment plant.
The project will use ultrafiltration and reverse-osmosis technology to treat wastewater, then piping it to industrial plants dozens of kilometers away.
Last year, IDE’s two owners, Israel Chemicals and Delek Group, hired Swiss investment bank UBS to speed up the sale of the jointly owned company.
Both owners have been selling off non-core assets over the past few years to focus on their main activities. Delek Group now is focusing almost exclusively on the energy sector after major recent discoveries of gas fields offshore of Israel's Mediterranean coast.
The financial industry sources said final bids are due in the fall, with a final sale expected by the end of the year. IDE reported a net profit of $3 million on revenues of $173 million in 2015.
China’s central bank said it plans to push the yuan’s global use by seeking more cooperation with other countries and improving the infrastructure needed to support wider use of the currency.
The comments were included in a three-paragraph statement, posted on the People’s Bank of China website Wednesday, on its forthcoming 2016 annual report on yuan globalization. The monetary authority didn’t provide other details about the findings or say when the report would be published.
The statement comes almost a year after China’s August 2015 devaluation of its currency, which roiled global markets and sent stock and commodity markets tumbling. The yuan’s share of global payments fell to 1.72 percent in June, the lowest amount since 2014, while the currency’s deposits in Hong Kong declined to a three-year low.
The PBOC’s statement Wednesday also said infrastructure for yuan internationalization will be improved, cross-border use under the current account will be increased and channels for yuan financing will be widened. It didn’t elaborate on how it would achieve these goals.
Use of the yuan as a reserve currency also will be increased, the central bank said. The International Monetary Fund will add the yuan to its Special Drawing Rights in October.
Fininvest, the family holding company lead by former prime minister Silvio Berlusconi, confirmed on Friday it had signed a preliminary agreement to sell 99.93 percent of Italian soccer club AC Milan to a group of Chinese investors.
The consortium includes Chinese development and investment fund Haixa Capital and Yonghong Li, chairman of the management company Sino-Europe Sports Investment Management Changxing, Fininvest said in a statement.
The holding company added that other Chinese investors - some of which state-controlled - would be part of the deal but did not give further details.
Fininvest said the deal valued the prized club at 740 million euros ($826 million), including 220 million euros of debt.
It said the buyers had committed to investing 350 million euros over the next three years, of which 100 million euros would be paid at the signing of the preliminary agreement.
Silvio Berlusconi’s era at the helm of AC Milan is over after 30 years. The Berlusconi family’s investment vehicle Fininvest SpA signed a preliminary contract to sell 99.9 percent of the soccer club to a group of Chinese investors operating through a management company led by the state-owned Development & Investment Corp. for 740 million euros ($826 million), including about 220 million euros of debt, the company said in a statement. The binding contract is expected to be completed by the end of 2016.
Milan has struggled in recent years, with the team a shadow of the roster that regularly competed for soccer’s top prizes. Since Berlusconi took control of the team in 1986, Milan has won eight league titles and five European cups, marking the most-successful period in the club’s history.
The sale agreement requires the purchasers to carry out capital increases and liquidity injections for a total of 350 million euros over a three-year period.
Chinese investors will now control both Milan soccer teams following the recent investment by Suning Holdings in crosstown rival Inter Milan. The AC Milan deal underscores China’s push to buy soccer assets across the globe. Some of the country’s biggest companies have been on a buying spree for the past two years, picking up teams, media companies and other businesses related to the world’s most popular sport. Clubs in China, meanwhile, have been the biggest spenders in the global transfer market this year.
Berlusconi turned AC Milan into one of soccer’s most iconic teams and a perennial power. The billionaire’s lavish spending in the early years helped lure some of the sport’s top talent, players such as Marco Van Basten who drew an army of followers around the world.
Milan is popular in China, where Italy’s Serie A became the first top league to be broadcast by state television. Globally the club claims to have more than 380 million followers, a number bettered by only five or six other teams. AC Milan is ranked the 14th wealthiest in Europe, according to accountants Deloitte LLP.
The Chinese investment group includes Haixia Capital and Yonghong Li, which were members of the consortium led by Sonny Wu’s GSR Capital that was nearing an agreement to acquire control of the club in July, according to people familiar with the matter. Haixia Capital and Li chose to negotiate with Fininvest directly, said the people, who asked not to be identified because the discussions were confidential.
The China investors were assisted by Rothschild & Co. as financial adviser and Gianni, Origoni, Grippo, Cappelli & Partners as legal advisers. Fininvest was advised by Lazard and BNP Paribas and the Italian law firm Chiomenti.
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