Headquartered in Saudi Arabia, ACWA Power, a developer, owner, and operator of power generation and water desalination projects has signed an agreement with Silk Road Fund for a 49% stake in the company.

With this agreement, the Silk Road Fund will be the official partner and shareholder in ACWA Power Renewable Energy Holding Ltd. However; the transaction is subject to customary consents. The company is a medium-to-long term development and investment fund established in Beijing in December 2014 under the framework of the Belt and Road Initiative.

Mercom has reported previously about China’s plans to utilize its ambitious One Belt One Road initiative to expand renewable energy along the economic belt. Initially announced in 2013 to restore the ancient Silk Route that connected Asia and Europe, the scope of the project has now expanded to include new territories and development initiatives. The project involves building a large network of roadways, railways, maritime ports, power grids, oil and gas pipelines, and associated infrastructure projects.

According to Paddy Padmanathan, the president and CEO of ACWA Power, further collaboration between the two companies “is a mirror image of the robust and strategic ties between Saudi Arabia and China that is strengthened year after year.”

Rajit Nanda, Chief Investment Officer at ACWA Power added, “As a leading developer of power and water assets in the region, and being based in a Belt and Road country, welcoming Silk Road Fund on board as a shareholder further cements our position of being able to support both the economic transformation envisioned by the Belt and Road initiative as well as Saudi Arabia’s forward-looking Vision 2030. Our continual achievements with Silk Road Fund set an example of building strategic business ties and making the best use of the competitive advantages of both companies.”

ACWA Power acts as a platform that capitalizes on the rapidly growing potential for renewable energy in the emerging markets. The company owns ACWA Power’s concentrated solar power (CSP), photovoltaic (PV), and wind assets across the United Arab Emirates (U.A.E), South Africa, Jordan, Egypt, and Morocco, yielding an aggregate capacity of 1,668 MW. ACWA Power and Silk Road Fund have previously co-invested in two U.A.E-based projects.

Last year, Mercom reported that ACWA Power announced the financial closure of the Sakaka solar project, the first utility-scale renewable energy project developed in Saudi Arabia under the National Renewable Energy Program executed by the Renewable Energy Project Development Office.

Earlier, Mercom reported that ACWA Power would invest $302 million to develop the Sakaka solar project. Also, the Public Investment Fund (PIF) of Saudi Arabia has acquired a 15.2% stake in ACWA Power.