Boustead Singapore, the infrastructure-related engineering services and geo-spatial technology group, says wholly-owned subsidiary Boustead Knowledge has agreed to buy part of Giant Delight Holdings’ Bio-Treat Technology notes for $42,709,017. The notes can be converted into 854,180,330 Bio-Treat shares.

Boustead says the acquisition is part of the group’s pursuit of strategic investments and the expansion of its investment portfolio and that the business of Bio-Treat has been viewed as being complementary and synergistic to group’s water and wastewater engineering division.

On Dec 11, 2009, Giant Delight entered into a subscription agreement with Bio-Treat which was issuing HK$290,084,400 ($55,817,664) worth of 1% redeemable convertible notes with a maturity period of five years convertible into Bio-Treat shares at $0.04 per share.

Upon full conversion of all the sale notes, the 854,180,330 shares to be issued by Bio-Treat to Boustead Knowledge will represent 20.4% of the issued share capital of Bio-Treat on a fully-diluted basis, resulting in Bio-Treat becoming an associated company of Boustead. This represents an effective conversion price of $0.05 per share.

Should Boustead Knowledge choose not to convert the sale notes, Bio-Treat and Giant Delight will repay the former 110% of the consideration price on maturity.

The deal also has a put option which requires Giant Delight to purchase an equivalent and proportional combination of up to 50% of the outstanding sales notes and the shares that have been converted and are held by Boustead Knowledge.

Currently, Bio-Treat has an extensive portfolio of large-scale Built-Operate-Transfer and Transfer-Operate-Transfer projects in China, including Beijing, Jiangsu, Shaanxi, Hubei and Shandong.

Upon completion of these projects, Bio-Treat will have a daily treatment capacity of over one million tonnes of wastewater.

According to press releases, Bio-Treat currently has treatment capacity of 955,000 tonnes a day and currently treats 800,500 tonnes of wastewater a day.