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Water Industry Deals and News - October 2016

October 26, 2016

The O'Melveny Monthly Water Report includes select transactions and other items of interest occurring during September 2016. Please contact any member of the O'Melveny Water Practice for additional information on any of these items or any related items. 

Primary market activity in water-related projects in September centered in the United States and China and involved mergers and acquisitions, with substantial activity relating to water and wastewater treatment facilities and products as well as bottled water products.

Mergers & Acquisitions




NRW Utilities Limited
September 1, 2016

Water Intelligence plc (AIM: WATR) acquired NRW Utilities Limited for $765 million on September 1, 2016.  Water Intelligence plc is based in England and Wales and its principal subsidiary is American Leak Detection, Inc., an enterprise offering non-invasive water leak detection primarily in the United States. Founded in 2014, NRW specializes in providing leak detection and asset survey services, particularly in the waste water area, to water utility customers in the UK and the Republic of Ireland.

 


Ranhill Water (Hong Kong) Limited
September 1, 2016

SIIC Environment Holdings Ltd. (SGX:BHK) entered into a term sheet to acquire a 60% stake in Ranhill Water (Hong Kong) Limited from Ranhill Water Technologies (Cayman) Ltd. for approximately $40.4 million.  Ranhill Water (Hong Kong) Limited is an investment holding company that offers consultancy, project management, operation and maintenance services for wastewater treatment plants. Singapore-based SIIC group, previously known as Asia Water Technology Ltd,  has been operating in China’s water sector for over ten years with more than 80 water treatment and supply projects and four waste incineration projects across 15 municipalities and provinces.



Blue Water Technologies, Inc.
September 6, 2016

Canada-based Nexom Inc. acquired Blue Water Technologies, Inc. on September 6, 2016. Nexom manufactures waste water treatment technologies and serves customers in North America and internationally. Nexom was formerly known as Nelson Environmental Inc. and changed its name to Nexom Inc. in January 2016. Blue Water develops and manufactures water treatment technologies.

 


H2O Chemicals Ltd 
September 8, 2016

Marlowe plc (AIM:MRL) acquired H2O Chemicals Ltd. for $3.6 million. H2O Chemicals Ltd. provides water treatment services that prevent scale, corrosion, and microbiological fouling in heat exchange systems in the United Kingdom. Marlowe is focused on acquiring and developing companies that provide critical asset maintenance services.  The H20 acquisition follows Marlowe’s April 2016 acquisition of WCS Environmental Group, a provider of integrated water treatment, hygiene, testing, and engineering services.




McKeesport Wastewater System
September 9, 2016

Pennsylvania-American Water Company, Inc., the Pennsylvania subsidiary of American Water (NYSE: AWK) entered into an asset purchase agreement to acquire the McKeesport wastewater system from the Municipal Authority of the City of McKeesport, Pennsylvania for approximately $160 million. The transaction is subject to regulatory approvals, including the approval of the Pennsylvania Public Utility Commission, and the receipt of applicable environmental approvals, among others. The McKeesport wastewater system serves approximately 22,000 customers.


 


Hydration Company of PA
September 13, 2016

Xfuels Inc. (OTC: XFLS) entered into a letter of intent to acquire Hydration Company of PA, LLC and merge it into its subsidiary, Converde Energy USA Inc. Hydration Company of PA designs, builds, and operates regional water treatment facilities.



Nestlé Waters Facility
September 14, 2016

Javier Ramos Suarez acquired Nestlé Waters Facility for $5.175 million. The 22,000-square-foot Nestlé Waters Facility is located in Jupiter, Florida and was used as a distribution center for the company’s bottled water products. 


 



Mountain Water Systems
September 15, 2016

Michael Mathews and John Warren acquired Mountain Water Systems, a water softening equipment supplier located in Asheville, North Carolina, focusing on well water issues, from Jim Roberts and Steve Mayer who spent the past 8 years developing the company.



Rugao Honghao Metal Water Treatment Company Limited
September 21, 2016

Nantong Jiahe Technology Investment Development Co. Ltd. entered into an equity transfer agreement to acquire Rugao Honghao Metal Water Treatment Company Limited from ELL Environmental Holdings Limited (SEHK:1395) for $8.2  million.  Upon completion of the transaction Rugao Honghao Metal Water Treatment Company will cease to be a subsidiary of the ELL Environmental Holdings.  The Rugao Honghao heavy metal wastewater treatment facility has a capacity of 3,500 tons per day.


 

 


Avita Artesian Water, LLC
September 28, 2016

China Bilingual Technology & Education Group Inc. (OTCPK:CBLY), an operator of bilingual boarding schools, agreed to acquire the remaining 51% stake in Michigan-based Avita Artesian Water, LLC from iBrands Corp. (OTCPK:IBRC). As part of the transaction, China Bilingual Technology & Education Inc. will be changing their name to Avita Beverage Company Inc.  Avita operates as an alkaline water producer and a bottling company.



Venture Capital & Private Financings


 


Guangyuan Capital Water Co., Ltd.
September 26, 2016

Guangyuan Capital Water Co., Ltd. announced that it will receive $27 million in equity funding. The transaction will include participation from returning investor Beijing Capital Co., Ltd., which will acquire a 63% stake.



 
 


Korea Water Resources Corporation
September 30, 2016

Korea Water Resources Corporation announced that it received $37 million from the government of the Republic of Korea in a round of funding in which the company issued common shares. On closing, the investor retained its 100% stake in the company. The transaction has been approved by the board of directors of the company as well as by the Ministry of Strategy and Finance.  The Korea Water Resources Corporation, or K-water, is the governmental entity for comprehensive water resource development and provides both public and industrial water in South Korea.





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New Concepts Holdings Limited
July 25, 2016

New Concepts, a Hong Kong-based civil engineering firm, placed $21.5 million worth of shares with CEF Concept Holdings Limited and Go Million International Limited, the proceeds of which will be used for working capital and the proposed acquisition of a water treatment business. 

 

  

New Concepts Holdings Limited
July 25, 2016

New Concepts, a Hong Kong-based civil engineering firm, placed $21.5 million worth of shares with CEF Concept Holdings Limited and Go Million International Limited, the proceeds of which will be used for working capital and the proposed acquisition of a water treatment business. 

 

  



Goodnight Midstream, LLC

August 3, 2016


Zero Mass Water, Inc. 

August 4, 2016

Zero Mass Water, based in Scottsdale, Arizona raised $15 million in funding via private placement under Regulation D.  Zero Mass Water develops equipment that uses solar energy to produce potable water.

NRW Utilities Limited
September 1, 2016

Water Intelligence plc (AIM: WATR) acquired NRW Utilities Limited for $765 million on September 1, 2016.  Water Intelligence plc is based in England and Wales and its principal subsidiary is American Leak Detection, Inc., an enterprise offering non-invasive water leak detection primarily in the United States. Founded in 2014, NRW specializes in providing leak detection and asset survey services, particularly in the waste water area, to water utility customers in the UK and the Republic of Ireland. 

NRW Utilities Limited
September 1, 2016

Water Intelligence plc (AIM: WATR) acquired NRW Utilities Limited for $765 million on September 1, 2016.  Water Intelligence plc is based in England and Wales and its principal subsidiary is American Leak Detection, Inc., an enterprise offering non-invasive water leak detection primarily in the United States. Founded in 2014, NRW specializes in providing leak detection and asset survey services, particularly in the waste water area, to water utility customers in the UK and the Republic of Ireland. 

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Korea Water Resources Corporation
September 30, 2016

Korea Water Resources Corporation announced that it received $37 million from the government of the Republic of Korea in a round of funding in which the company issued common shares. On closing, the investor retained its 100% stake in the company. The transaction has been approved by the board of directors of the company as well as by the Ministry of Strategy and Finance.  The Korea Water Resources Corporation, or K-water, is the governmental entity for comprehensive water resource development and provides both public and industrial water in South Korea.