Company Profile
• Membrane technology based water and wastewater solution provider
• Asia’s pioneer and leader in Membrane Bioreactor (MBR) wastewater treatment
technology for industrial and municipal sectors
• Established track record with prominent clients such as Sinopec, CNOOC, CNPC,
municipalities and major industrial parks etc.
• Owns more than 30 water treatment assets with daily design capacity over 1.5 million
m3/day (municipal wastewater equivalent)
• Listed on the Mainboard of Singapore in 2004 and Taiwan Stock Exchange in 2010
• Strength in technology and EPC capability positions the company to capture the
industrial wastewater upgrading market --- the future
• Well positioned to ride on the growing trend of using membrane based technology for
drinking water treatment
Leading the Pack
• First Asian water player to focus on developing MBR technology
• First mover advantage allowed company to establish market leadership position
within 10 years
• First water treatment company that KKR, a global leading investment firm, have
chosen to take a substantial stake in
• First company to design and build several largest industrial and municipal
wastewater treatment plants in Asia using MBR technology:
o World’s largest underground municipal MBR plant: Guangzhou Jing Xi MBR Waste Water Treatment
Plant
o Largest industrial MBR wastewater treatment plant: Taixing Industrial Park
o CNOOC’s first oil refinery wastewater treatment plant and first MBR plant: CNOOC Refinery
Wastewater MBR at Huizhou
Business segments:
� EPC – Provision of turnkey services for the design, construction, installation and commissioning using membrane technology such as membrane bioreactor (MBR) and continuous membrane filtration (CMF) processes in microfiltration, ultrafiltration and reverse osmosis
� Water Investment projects (TOT/BOT/BOO) – Investment, design, construction, installation and operation of water or wastewater treatment facilities that are typically backed by off-take agreements from the Chinese Government
� Operation and Maintenance services – Operation and maintenance of existing water or wastewater treatment facilities for an agreed period and monthly fee, which provides a stable recurring cash flow.
Engineering, Procurement and
Construction (EPC)
Water Investment Projects
(TOT/BOT/BOO)
Operation and Maintenance
services (O&M)
Core Business
Milestones
2003
2004
2005
2006
20082009
2010
2011
•Incorporation of United Envirotech Ltd•Completed Wastewater Reclamation Project for Sinopec – first double membrane industrial “Newater” project, first of its kind in Sinopec Group•Awarded MBR project from Sinopec, first MBR for petrochemical industry and the largest petrochemical wastewater MBR plant in China upon completion
•Listed on Singapore Exchange•Awarded MBR project at Huizhou Daya Bay Petrochemical Hub, one of the largest industrial MBR in Asia
• Acquired a 200,000 m3/day wastewater treatment plant in Liaoyang , a milestone TOT investment project in municipal wastewater treatment plant
•Won Group’s first BOO investment project in industrial wastewater treatment plant in Guangzhou Nansha•Set up Malaysia operation, the Group’s fully owned subsidiary outside of China
•UEL’s Taiwan Depository Receipt (TDR) listed on the Mainboard of Taiwan Stock Exchange
•UEL formed JV company to acquire the industrial park wastewater treatment plant in Dafeng, Jiangsu
• Won EPC Contract to build Guangzhou Jingxiwastewater treatment plant. The 100,000 m3/day underground MBR is the largest MBR of this kind in the world.
•KKR announced additional investment of US$40 million into UEL in Jan 2013
2012
•Won EPC project to construct 100,000 m3/day drinking water project using double membrane technology• Invested in 7 wastewater treatment plants
•UEL acquired 13.18% of issued and paid-up share capital of Memstar
2013
•Subscription by KKR of US$ 113.8 million convertible bonds where proceeds were used for investment in water plants.
2007
•Won EPC contract to upgrade a 30,000 + 40,000 m3/day industrial wastewater treatment plant into MBR in Taixing, Jiangsu
Growing Chinese Market for “Water” Technology
• China’s Looming Water Crisis:
o Identified as 1 of the 13 countries with extreme water shortages by United Nations1
o Home to 20% of the world population but holds only 6% of the world’s water resources1
o 2/3 of the Chinese cities suffer from insufficient water supply
Per Capita Water Resources (Ton)
2,1343,3656,511
9,344
23,348
28,49830,352
ChinaJapanWorld Average
USAustraliaBrazilRussia
Source: World Bank
• Significant growth in China’s water market:
o Water pollution is also worsening, with all seven major river basins in China classified as having top grade pollution by the government, and more than 300 million population inaccessible to safe drinking water
o The government is planning a total of $300 billion invested into water treatment over the next 10 years, with favorable policies to attract private sector investors, creating significant market opportunities
Market Size of China Waste Water Treatment Sector(US$ billion)
7.0
6.1
5.0
4.03.3
CAGR: +20%
2011E2010200920082007
Source: E&Y
Growing Chinese Market for “Water” Technology
Strong Policy Support for Wastewater Treatment
o Earmarked wastewater treatment as the No. 1 priority for environmental protection development in the 12th Five-Year Plan (FYP) from 2011-20152
o Plans to spend RMB1 trillion on water and wastewater infrastructure during the 12th FYP3
o 12th Five-Year Plan requires all counties and cities to achieve wastewater treatment ratio of 80% and 85% respectively, from the current 50% and 75%4
o Strict discharge guidelines established in recent policies5
o Based on the target to increase urban wastewater treatment rate from 78% in 2010 to 85% in 2015, 23-37 mn tons/day, valued at CNY 66 bn worth of new WWTP is to be added.
o 8% reduction target in COD, 10% reduction target in Nitrate and ammonia nitrogen emission over 2010 level by 2015, points to upgrading opportunity to meet more stringent discharge limits.
o Urban recycled water rate of 20% by 2015 implying a 28% CARGR on water recycle capacity during 2011 to 2015. Estimated CNY 28 bn to be spent on recycled-water development.
o Non-traditional water source such as desalinated seawater, recycled wastewater will favor the use of membrane technology
The MBR Potential
• MBR has been identified by the
Chinese Government as a key solution
for the water shortage/pollution 1
• MBR is becoming the preferred water
treatment of choice2
o Account for around 3% of the total water
treatment market in China, vs >20% in
Korea and Singapore.
o With cost gradually declining, market
share of MBR vs conventional
technologies particularly in industrial and
municipal waste water treatment and
recycling projects, is expected to increase
o MBR market size in China have grown at a
CAGR of +113% from 2004-2010 and is
expected to grow at a CAGR of >50% over
the next 5 years from 2011-2015.
(1) Report by Emerging Markets Private Equity Association released on October 2012(2) China Water Net Consulting
MBR Market Size in China(US$ million)
554
369246
13669426
2015E
4,203
…2010E2009E20082007200620052004
Water Treatment Processes Used by United Envirotech:
Technology Key Functions Applications
Membrane Bioreactor (MBR) Combines membrane separation
with biological wastewater
treatment for direct recycling
• Biological wastewater treatment
• Wastewater recycling
• Wastewater treatment plant
upgrade
Continuous Membrane Filtration
(CMF)
Utilises microfiltration or
ultrafiltration membrane to
achieve removal of submicron
contaminants in water
• Drinking water production
• Pretreatment to reverse osmosis
• Wastewater reclamation
Reverse Osmosis (RO) Reverses the flow of water in the
natural process of osmosis
• Water purification & deionization
• Desalination of seawater
• Wastewater reclamation
Continuous Membrane Filtration &
Reverse Osmosis (CMF + RO)
Integration of CMF and RO
technologies into one system
• Seawater desalination
• Wastewater reclamation (NEWater
application)
• Deionized water production
MBR- The Water Treatment Technology of Tomorrow
Best Available Technology by China Membrane Technology
MBR technology Traditional Biological Technology
Process Biochemical treatment + Membrane
separation
Biochemical treatment + clarfication
Land Requirement Compact facilities
Occupies only 20% - 50% land area of
traditional plants
Complex and bulky facilities
Occupies large area
Investment Slightly higher equipment investment
offset by significantly less land and
construction costs.
Highly advantageous when land
resources are scarce
Slightly lower equipment investment but
significantly higher land and construction
costs
Operating Cost Low operating cost High operating cost
Water Quality High output quality suitable for highly
polluted water and recycling
Low output quality in comparison
MBR- The Water Treatment Technology of Tomorrow
Demand for Membrane Based Drinking water Treatment Technology
• Increasing Water Tariffs:
o China’s wholesale water price has risen by 10%
CAGR over the past 10 years to reach an
average of Rmb3.68/ton as of Jul 20111
o Water tariff increase is expected to continue to
outpace inflation in the next few years at an
average rate of 5-10% p.a.1 as water tariffs as a
% of household disposal income compared to
other global peers is still low2
• Demand for better quality drinking water
o Tightening of drinking water standard coupled
with deterioration in raw water quality favours
better treatment technology.
o Increase in adoption of membrane based
drinking water plants.
• Stable supply of membrane products is critical for
the Group’s membrane based water and
wastewater treatment system
• Rationale of acquisition:
o Strengthen strategic relationship between UEL and
MTL
o Leverage on MTL’s membrane technology
o Benefit from the growth of the MTL in view of its
strong membrane technologies and research and
development capabilities
Move towards Vertical Integration
• Leading manufacturer and supplier of polyvinylidenefluoride (“PVDF”) hollow fibre membrane and membrane products
• One of the few manufacturers of high performance PVDF hollow fibre membranes in the world today
Acquired 13.2% stake for
S$35 million on 9 Jan 2013
Established Track Record:
• Recognized as a market leader in industrial MBR in AsiaStellar reputation with prominent clients such as Sinopec, CNOOC, CNPC, municipalities and major industrial parks etc.
Pioneer of MBR technology in Asia - the Preferred Water Treatment method of Tomorrow:
• MBR received the Chinese government’s stamp of approval
Strong Support from KKR, Strategic Partner:
• 2 major investments from KKR totally US$154 million (includes US$40 million pending approval from EGM)
Experienced Management with Proven Execution Capabilities:
• Strong leadership and dedicated team
Twin Engine of Growth: EPC and Investment
• Technology and EPC capability allow UEL to venture into high margin upgrading industrial projects
Competitive Strengths