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Peggy Sito

Kerry Properties has teamed up with Malaysia-based Kuok Brothers for a 228 million yuan (about HK$212.72 million) water resources investment in Benxi, Liaoning province, as part of the group's infrastructure expansion in China.

The move is the company's first mainland water resources project after its strategic investments in the Shanghai section of the Hu-Ning Expressway and the container terminal project in Shenzhen.

Kerry Properties is controlled by Kuok Group and is part of Robert Kuok's listed interests which also include Shangri-La Asia, Television Broadcasts and South China Morning Post (Holdings).

Company chief financial officer Chew Fook Aun said the project marked the group's efforts to speed up its China infrastructure expansion.

Mr Chew said the group would prudently look for new investment opportunities. Joint managing director Ang Keng Lam said the investment would provide steady long-term recurring earnings for the group.

 The water resources project is 70 per cent owned by Kerry-Chemquest Benxi Water, 50 per cent by Kerry Properties and 50 per cent by Kuok Brothers' wholly owned subsidiary Chem Quest. Benxi Water Supply Co owns the remaining 30 per cent.

The investment mainly includes the construction of a dam and power generation unit to supply water to Beitai Steel Mill, the city's second largest, and the surrounding residential area.

Chem Quest senior manager Tay Yong Thye said the joint-venture company also planned to build a 27-kilometre pipeline project in Benxi with an investment of less than 100 million yuan.

Mr Tay said the joint venture was for 55 years, while the mainland government had guaranteed the foreign partners could recoup their investment within seven years.

Upon completion in five years, it will have a water storage capacity of four million cubic metres, supply more than 60 million cubic metres of water and 2.7 million-kilometre hours of electricity a year.



Kerry signs first China water deal