By Yvonne Lee
HONG KONG--Shares of China Gas Holdings Ltd. (0384.HK), a target
of a takeover proposal by ENN Energy Holdings Ltd. (2688.HK) and
state oil giant China Petroleum & Chemical Corp. (SNP), or
Sinopec, were suspended from trading Monday morning after it signed
cooperation agreements for the expansion of its natural gas and
liquefied petroleum gas businesses.
China Gas President Eric Leung told Dow Jones Newswires the
suspension wasn't related to the takeover proposal by the two
energy companies and the company will issue a statement on this
matter later. However, he declined to give more details.
China Gas, which controls gas pipelines that serve more than six
million customers in China, said Monday morning the suspension was
due to an announcement "which is price sensitive in nature." The
stock closed Friday at HK$4.30 per share.
In September, ENN Energy and Sinopec extended to today the
deadline for the completion of negotiations on their $2.15 billion
planned acquisition of China Gas.
The acquisition faces an uphill struggle as major shareholders
of China Gas--including Fortune Oil PLC (FTO.LN), founder Liu Ming
Hui and Beijing Enterprises Group Co.--have been increasing their
holdings in the company since ENN Energy and Sinopec launched their
takeover attempt in December.
Gaining a controlling stake in China Gas--which has a market
capitalization of $2.2 billion--won't be cheap. But the jockeying
for control of the company highlights the industry's view that
China Gas, which has exclusive rights to operate pipelines in 151
cities across China, is worth the effort.
Write to Yvonne Lee at yvonne.lee@wsj.com
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