China Petroleum & Chemical Corp., aka Sinopec, and ENN Energy and Holdings Ltd. are offering $2.15 billion in cash for China Gas Holdings to take over the fuel-distribution network that spans across 20 provinces.
According to Bloomberg, “ENN and Sinopec, Asia’s biggest refiners, bid HK$3.50 a share for the Hong Kong-based company that supplies piped gas to the mainland, the companies said today in a statement. The offer is 25 percent more than China Gas’s last close.”
ENN will fund 55 percent of the deal and Sinopec will fund the rest.
Purchasing China Gas will grant the two companies access to 6.6 million residential customers and 41,981 industrial and commercial users, says Bloomberg.
Sinopec and ENN have plans to further develop the gas distribution network in China, and they have no intentions to change the employment of the current China Gas workers.
The offer came as a surprise to China Gas and they have yet to make a final response. Also, “The takeover would be subject to government approvals,” reports The Washington Post.
That’s all for now,
Cori
