Modern water rockets higher on China agreement

Modern Water, a water purifying and monitoring technology company, has signed a 'Framework Agreement' with Hangzhou Development Center of Water Treatment Technology (Hangzhou Water) for China, sending the shares up in early morning trade.

Details of the deal were sketchy but the partnership allows both organisations to jointly identify and develop projects in China, including seawater desalination plants and other water-related opportunities.

The significance of this move lies in the fact that state-owned Hangzhou Water is a key player in the water industry in China, specialising in membrane systems that have different industrial uses such as seawater desalination, industrial pure water preparation and water reuse. It has won or been involved in approximately 60% of China's current or planned desalination projects.

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According to figures cited by Modern Water, this industry sector in China is estimated to see investment of up to $3.2bn over the next four years.

Last year Modern Water appointed a non-executive chairman to drive business development in the region. This appointment was supported by the growth of Modern Water's Monitoring Technologies division in China which last year contributed sales of more than £0.5m to the group.

The positive news follows an announcement on September 5th that Modern Water had commissioned its first commercial desalination plant in Oman.

The shares were up 11.5p to 55p at 10.25.

CM