ZK International Group Co., Ltd and Tuopeng Industrial have announced plans to create a joint venture to bid on a US$700 million navigation and hydropower project in Chongqing, China.
The government of Chongqing, the largest city in western China, is planning to build a Navigation and Hydropower Junction (the "Junction") on Qu River to connect the river, whereby making it possible for ships to directly sail to Shanghai via Chongqing. The project is a new model of inland river development, which is designed to provide services beyond navigation, such as electricity generation, water supply, flood and drought management, irrigation, fisheries, environmental services, and recreational activities. Such projects will have significant economic, social and environmental benefits to the area.
Following the signing of a letter of intent, ZK International will own 51% of the joint venture and Tuopeng Industrial will own 49%. The firms have been negotiating with various levels of government and the deal depends on the completion of due diligence by all parties, final approval of the government, and board approval of both parties.
If approved, the project is expected to have a significant positive impact on the growth of both companies in 2021 and move forward ZK International’s plans to expand into the western China market.