VPower Group International Holdings Limited(“VPower Group”, stock code: 1608), a leading private gas-fired engine-based DPG station owner and operator in Southeast Asia, is pleased to announce that, the Group has entered into a USD$30 million 3-year convertible loan agreement with F.K. Generators and Equipment Ltd (“F.K.”) to participate in the 80 megawatt heavy fuel oil (“HFO”)-fired distributed power generation (“DPG”) project (the “Project”). The Project is expected to be in commercial operation in the fourth quarter of 2017.
Under the terms of the option deed associated with the loan, the loan is guaranteed by F.K. and secured by key Project assets. VPower Group has the right to convert to at least 51% of the equity interest in the Project company and to exercise this option right within the loan period.
The Project will be running on 7 units of medium speed HFO power generation system. Under a 20-year concession period that is granted by the Peruvian Ministry of Energy and Mines, the Project can provide an estimated capacity availability revenue of approximately US$350 million (before any operation and maintenance services revenue and pass-through fuel revenue), and was guaranteed by the state of Peru which has been given a BBB+ credit rating by Standard & Poor.
Mr. Rorce AU YEUNG, Co-Chief Executive Officer of VPower Group, said, “In the collaboration with F.K., the Project will be running on HFO which enjoys a high cost efficiency, and is in consistent with the Group’s fuel source diversification strategy. It also proves that we can leverage on our strong SI customer network to offer more opportunities for our IBO business, and enable us to enter into new emerging markets. We believe this project can accelerate the Group’s IBO business penetration into South America and other new potential markets. In addition, under the 20-year concession period, the Project can provide sustainable revenue for the Group in the long run.”
About VPower Group International Holdings Limited (Stock code: 1608)
VPower Group is one of the world’s leading large gen-set system integration providers, and Southeast Asia’s largest private gas-fired engine-based DPG station owner and operator. The company derives operational synergies between its System Integration (SI) and Invest, Build and Operate (IBO) businesses. Under its IBO business, the company invests in, builds, and operates utility-grade DPG power stations. It is headquartered in Hong Kong and was listed on the Stock Exchange of Hong Kong in 2016.
About F.K. Generators and Equipment Ltd（”F.K.”）
F.K. is an Israeli-based power solutions provider with operations in Israel and South America. VPower Group has had a long standing system integration customer relationship with F.K. and has sold over 600MW of PGSs to F.K. over the years, making it one of the Group’s top five SI customers […]