Sinopec and ENN Energy Holdings offer up to US$2.2bn for China Gas

Sinopec (Hong Kong: 0386.HK) and ENN Energy Holdings (Hong Kong: 2688.HK) are offering up to US$2.2bn cash for control of privately-run natural gas distributor China Gas Holdings (Hong Kong: 0384.HK), in what could become a rare hostile takeover for a mainland company, reports Reuters.

They are offering HKD3.50 per China Gas share, or a 25% premium to the previous closing price, but there is no guarantee the China Gas board would accept the offer and it said it had not held talks with the companies on the terms of the proposed acquisitions.

“The unilateral announcement from China Gas may suggest that the offer from ENN Energy/Sinopec is a hostile takeover,” Deutsche Bank said in a research note to clients.
At present, Sinopec holds a 4.8% stake in China Gas while ENN is not part of the company’s shareholders. Other key stakes are controlled by SK Holdings, Gail India Ltd and Oman Oil Co.