HONG KONG (Reuters) – The private equity arm of Standard Chartered (STAN.L) (2888.HK) closed a deal to invest $22.3 million in Sangle Solar Energy Co Ltd, a Chinese maker of branded solar water heaters, the Asia-focused bank announced.
Shandong Provincial Academy of Science, backed by the local government, would remain a major shareholder in Sangle, headquartered in the northern Chinese province of Shandong, the British bank said in a faxed statement.
The statement did not elaborate on the stake size Standard Chartered Private Equity Ltd (SCPE) would receive for its investment.
“China’s solar water sector will grow fast in the next few years because of favorable regulatory policies and, more importantly, driven by the low penetration of water heaters in China’s rural areas,” said Wei Zhu, managing director for SCPE in Greater China, which includes mainland China, Hong Kong and Taiwan.
Standard Chartered’s (StanChart) investment in Sangle is the first deal led by Zhu since he joined the firm in October.
Zhu was a senior managing director for buyout firm CVC Capital Partners and he led its Beijing office after joining CVC in July 2008 from the investment banking joint venture of Goldman Sachs (GS.N) in China.
Zhu’s father is a former postal and telecommunications minister and held other senior political positions after retirement in China, sources told Reuters.
Sangle makes and distributes solar water heaters for household use in China and has secured strong sales coverage in Shandong and neighboring provinces in the past three years.
The company, which runs more than 10,000 distributors across the nation, the largest network in this sector in China, plans to gradually further expand its sales network nationwide, according to the statement.
(Reporting by George Chen; Editing by Chris Lewis)