Zhitong Finance App News, Beijing Energy International (00686) issued an announcement regarding the establishment of an infrastructure fund. The infrastructure fund currently holds Yulin Company (which owns a 300 MW photovoltaic power generation project in Shaanxi Province, China) and Jingtai Company (which owns a 100 MW photovoltaic power generation project in Hubei Province, China).

The company plans to expand the infrastructure fund to acquire additional assets. To this end, the infrastructure fund will raise further capital through the issuance of such units, and Yunnan Baoshan (an indirect non-wholly-owned subsidiary of the company) and Jingneng Tongxin (which anticipates entering into a concerted action agreement with the Group regarding the infrastructure fund) plan to subscribe for 51% of these units. Proceeds from further capital raising will be used by the infrastructure fund to acquire all of the shares in the project company in Baoshan, Yunnan. Application materials relating to further infrastructure fund raising have been received by the China Securities Regulatory Commission and the Shanghai Stock Exchange for approval.

On the date of this announcement, Baoshan, Yunnan is transferring related assets (namely the 315 MW Sujiahekou Hydropower Project and the 168 MW Songshan Hekou Hydropower Project in Tengchong, Baoshan City, Yunnan Province, China) to the target company. After the proposed transfer is completed, the infrastructure fund will hold all of the project company's shares, and the project company will own the relevant assets. It is proposed that after the transfer is completed, the project company will remain a subsidiary of the company.

The proposed transfer will be a good example of the company's ability to raise funds through different financing channels, thereby improving the company's image and position in the capital market; the net proceeds collected by the Group from the proposed transfer will provide the Group with working capital, thereby enabling the Group to reduce its net borrowing, thereby improving its working capital and leverage situation; the proposed transfer will provide additional capital for the original stakeholder Baoshan, Yunnan. The additional funding will enable Baoshan, Yunnan to further develop its other existing renewable energy projects and fund new investment opportunities, thereby boosting its business development; the proposed transfer will further reduce the operational risks of the original stakeholder Baoshan, Yunnan. As a result of the proposed transfer, Baoshan, Yunnan has implemented a series of corrective measures on related assets, such as resolving outstanding compliance issues. It is expected that such measures will make Baoshan, Yunnan and related assets more in line with applicable laws and regulations; the proposed transfer will further expand the scope and enrich the composition of the infrastructure fund's investment portfolio. At the same time, it is expected that this move will broaden the investor base of infrastructure funds, thereby increasing the liquidity of infrastructure funds and improving their performance in the secondary market. The company expects that the above situation will enhance the confidence of existing investors and attract more investors in the future; and the proposed transfer will enable the company to realise some of the relevant assets and achieve valuation potential in the form of prior cash proceeds, and enable shareholders to benefit from the company's continued equity in infrastructure funds in terms of stable income generated by related assets and future development.