The International Finance Corporation (IFC), a member of the World Bank Group, has approved a proposal to provide a loan to Jiangsu Linyang Energy Co., Ltd. (Linyang), a Shanghai-listed solar power generation and electricity meter manufacturer, according to a disclosure.
IFC had initially considered extending up to $60 million to Linyang through a combination of a loan from its own account, a B1 loan, a B2 loan under its Managed Co-Lending Portfolio Program (MCPP) and a trust loan in its capacity as the implementing entity for the MCPP.
IFC’s board approved a $14 million financing for the solar firm, showed its disclosure.
Qidong-headquartered Linyang is seeking to raise capital to construct its first grid-parity solar projects in China to help reduce greenhouse gas emissions and meet increasing electricity demand. Out of the planned 299 MW solar assets, half will be constructed in the frontier provinces of Anhui and Hebei.
The entire project cost is estimated at approximately $170 million.
“The project will support a private renewable energy developer to enter the subsidy-free solar generation space, demonstrating the role for the private sector in the electricity market in China which is dominated by large state-owned players,” the international lender said.
Linyang’s largest shareholder is Qidong Huahong Electronics Co., Ltd. (Huahong) with a 40.69 per cent stake. Founder and chairman Yonghua Lu owns 90 per cent of the shares in Huahong and a direct interest of 4.54 per cent in Linyang. The rest of Linyang’s shares are widely distributed among many institutional and individual investors.
Recently, IFC proposed to extend a loan of up to 1 billion yuan (approximately $150 million) to China’s live hog producer Muyuan Foods Co., Ltd. Earlier, the lender said it was considering a proposal to extend a loan of 350 million yuan ($50 million) to Chinese microfinance company Simple Credit Micro-Lending Co., Ltd.
In the renewable energy sector, IFC in January proposed to make a debt investment of $36 million in a 250 MW solar project being developed by Mahindra Renewables Private Limited (MRPL) in Rajasthan. Previously, the international lender considered a debt financing of up to $43.3 million in India’s Clean Solar Power, a step-down subsidiary of Hero Future Energies.