The inking of the agreement between the two will see Aquity executing a 10+10 abattoir wastewater treatment-as-a-service agreement with one of the country’s premier beef producers. It will generate around USD 3.5 million in free cash flow for twenty years. Concurrently, debt financing arrangements along with equity capital shares will be handled by Lifequest.
Since the growth of onsite wastewater plants is expected to reach USD21.8 billion this year, of which 9.1 billion is purchased by municipal water, 8.4 billion by industrial wastewater and 4.4 by municipal drinking water, numerous industrial players are expected to further their business reach by utilising existing connections and frameworks. According to recent press statement, Lifequest World Corp, an organisation that specialises in both effluent and sewage treatment solutions, has now signed a Letter of Intent with Aquity to provide BOO (Build-own-operate), BOLT (Build-Own-lease-transfer) and WaaS (Water-as-a-service) models for South African plants, including both evergreen (perpetual) or minimum 10-year concessions and 7-year leases. Together they are expected to yield a steady cash stream with equity IRR (internal rate of return) of slightly over 25%.
Mr Max Khan, CEO, explains that governments and corporations are increasingly turning to these three models since private equity and impact investors with a steady cash flow. “We have an opportunity to build a portfolio of such plants over the next 18 months in the countries we operate in. In order to execute the projects in the pipeline, we are actively pursuing several project debt financing options.” He added.
Source: Lifequest World Corp.