Hikvision to Fund Public Projects With $3.1 Billion Line of Credit
On November 30, 2015, Hikvision finalized a deal in which they received a $3.1 billion line of credit from China Development Bank.
“Hikvision is planning to participate in a multitude of public projects that aim to benefit existing and developing communities, including cities and municipalities worldwide,” said Alex Asnovich, director of marketing, Hikvision North America. “Examples of these projects include intelligent transportation networks, energy production and supply systems, community infrastructure improvements and other critical initiatives. Hikvision plans to participate in a PPP (Public – Private – Partnership) financing program, which requires a combination of public and private partnership. As a part of the program, private and publically traded companies like Hikvision are required to inject capital into public projects which would naturally require additional funding. This is what this line of credit can be used for.”
Regarding the possibility of making acquisitions, Asnovich said, “Merges and acquisitions have not been Hikvision’s strategic focus since the company’s inception. Instead, we always pursued our success through offering innovative products and solutions utilizing our R&D capabilities and pursuing the right markets. However, if a good prospect would arise, we would always be interested to study our options. The line of credit we recently received could also prepare us in advance of an M&A opportunity.”
Hikvision has no set period in which to spend the money; Asnovich said the credit line will be used for a variety of projects worldwide and in China as they come up.
Asnovich said the loan’s size is an indication of how financial institutions view Hikvision’s sound financial record and credit rating, its innovation and sustainable growth. “The financial market clearly sees Hikvision as a successful company to get this approved,” Asnovich said. “Even in North America Hikvision USA is often being contacted by many financial institutions offering lines of credit for potential expansion, which indicates consistency in our successful global strategy.
Hikvisions’s board of directors and relevant leadership management team will determine exactly how the funds are dispersed. Out of the total credit line of $3.1 billion equivalent, more than $1.6 billion equivalent is earmarked for Chinese domestic projects with the remaining $1.5 billion going to global expansion.