1 / 16

Veolia Water Linking cities to finance

Veolia Water Linking cities to finance. 27 September 2010. Contents. Overview of Veolia Environnement and Veolia Water Veolia Water in China Types of contract: BOT and Concessions BOT – case study in China: Chengdu Concession – case study in China: Shanghai. Veolia Environnement .

kenyon
Download Presentation

Veolia Water Linking cities to finance

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Veolia Water Linking cities to finance 27 September 2010

  2. Contents • Overview of Veolia Environnement and Veolia Water • Veolia Water in China • Types of contract: BOT and Concessions • BOT – case study in China: Chengdu • Concession – case study in China: Shanghai

  3. Veolia Environnement Key figures Veolia Environnement as of end 2009: • More than 155 years of experience in environmental services • 312,590 employees • Operations in 74 countries • €34.6 billion in consolidated revenue The global benchmark for waste management and resource recovery €9 billion The standard for managing safe and sustainable mobility solutions €5.9 billion The global benchmark in water services €12.55 billion European leader €7 billion

  4. Veolia Water Worldwide Key figures Veolia Water as of end 2009: • Activities: • Water services • Wastewater services • Construction/Technologies Key figures: • €12,560 million in consolidated revenue • 95,789 employees • Operations in 66 countries • 4,500 contracts managed around the world Technical Data: • 5,263 water production plants around the world • 3,229 wastewater treatment plants around the world

  5. 31/12/2009: 12 889 employees Veolia Water in China Population in China: 1,321 million inhabitants Population concerned by our projects: 35.91 million inhabitants (with 25,55 people served under full-service contracts)

  6. Types of contract Types of contract • 1 - BOT = Build – Operate – Transfer • The Company is responsible for design, construction and operation of a specific plant and for the capital investments (mainly for the construction funding). • The Company is paid on the basis of guaranteed volume (Take or Pay formula), for a certain period of time (from 15 to 30 years). • After this period, the facility is transferred to the client in good working condition. • Volume and tariff are guaranteed

  7. Types of contract Types of contract • 2 - Concession • Full services contract covering production, distribution and customer services. • The company bears all costs (salaries, energy, chemicals and maintenance) and all capital investments. • The company is paid by the final consumerson a m3 basis. • Concessions are long-term contracts - often 20 to 30 years, sometimes 50 years. • Risks on volume and tariff

  8. BOT Case study in China China Chengdu Project • First BOT water treatment plant organized through an international tender in China • Contract was awarded in 1998 for a duration of 18 years • Capacity of 460,000m3/day

  9. Chengdu Project – Contractual structure BOT Case study in China • Contract awarded to a Joint-Venture between Veolia (60%) and Marubeni Corporation (40%) • Project company managed and controlled through a board of directors: • - 3 from Veolia including the chairman • - 2 from Marubeni

  10. Chengdu Project – Key milestones BOT Case study in China • Early 1998: five companies short listed in the international bid • 1998: Veolia Water and Marubeni Corporation selected • Sept 1998: syndication negotiations • Nov 1998: ADB Credit Committee Approval and EIB approval in principle • Nov 1998 to March 1999: road shows • March 1999: syndication in place • March to Nov 1999: negotiations of lending agreements • Aug 1999: financial closing • Oct 1999: commencement of construction • During the Asia Financial Crisis in 1997, the Chengdu project successfully obtained robust financial backing • Confidence of investors in the project

  11. Chengdu Project – Financial structure BOT Case study in China • Initial investment, including interests and operating costs during construction : USD106.5 million financed through: • equity (30%) • limited recourse long term loans (70%) • 75% of long-term loans reimbursed at the end of 2009 • 90% of the principal repaid at the end of 2011 DEBT FINANCING STRUCTURE

  12. Concessions Case study in China China Shanghai Pudong Project • Contract to operate and maintain the water services in the key business district of Pudong, Shanghai • Full water services (covering water treatment, network distribution and customer services) • Population served: 2.65 millions

  13. Working in partnership with Shanghai Pudong Concessions Case study in China • A milestone in water industry: • First significant public-private partnership for full water services in China • First time a private foreign water operator has shared the entire management of a Chinese water company • Pudong Water Corporation formed in 1999 when the Shanghai Water Authority separated the city’s water supply system into four companies. • International bid launched in 2001 • Veolia Water designed in May 2002 as the successful bidder for the purchase of a 50 percent stake in Pudong Water Corporation. • Licence for the 50-year water supply operations in the Pudong area started in September 2002. • Veolia purchased 50% of the stocks of the Pudong Water • Corporation (no project finance).

  14. Shanghai Pudong – Contractual structure Concessions Case study in China

  15. Shanghai Pudong – Investments Concessions Case study in China • VW initial investment amounts to RMB 2,026 million for the acquisition of 50% of the JV shares. • Shanghai Pudong is today considered as a mature project. • Impressive modernization and improvements realized in less than 7 years. • Major investments done since 2002 to meet the water demand (total cumulated CAPEX amount to approx. 2 billion), • JV will continue to invest at a lower level, in particular for equipment renewals.

  16. Thank you for attention

More Related