C&G Environmental Protection Holdings, the emerging player in China’s renewable Waste-To-Energy sector, announced today that it has entered into a conditional sale and purchase agreement to sell its polyethylene terephthalate (PET) chips and yarn production business to Hou Shiqing. the major shareholder of Shishi City Gangyi Dyeing Manufacture, a textile producing company based in China.

According to the agreement, the group will receive US$45.8 million ($65 million) from the disposal or 12.7% discount to the net asset value of RMB358.4 million ($74.3 million) as at 31 March 2010. The disposal amount was derived on a willing buyer-willing seller basis and taken into account the increasing competition and challenging operating environment facing the PET chips and yarn production business.

The disposal will provide a significant liquidity boost to the group’s cash balances, which stood at RMB529.6 million as at 31 March 2010.