Photo by Steve Jurvetson (Flickr) [CC BY 2.0 (http://creativecommons.org/licenses/by/2.0)], via Wikimedia Commons
Hong Kong-based firm DeTai New Energy Group Ltd (HKG:0559) intends to acquire biofuels company China Century Bio Energy (Hong Kong) Investment Co Ltd as it seeks to expand its new energy business.
The target has developed a biological butanol technology with high concentration organic sewage as the feedstock. The biofuels it makes are mainly used in power generation, and in marine and car fuels. It holds respective stakes of 67% and 88% in Ningbo Shi Fenghua Hualian Century Bio Energy and Zhejiang Hualian Century Bio Energy.
DeTai has signed a non-legally binding memorandum in relation to the acquisition. It expects to reach a formal agreement before the end of August. The amount to be paid as part of the deal is yet to be determined.
The buyer is engaged in the new energy sector, the manufacturing and sale of electric cycles, hotel hospitality and other businesses. DeTai sees synergies with its own new energy business and expects the acquisition to lead to “rapid growth in product development”.