The Hong Kong gas company, China Resources Gas Group Ltd., is in the process of trying to buy a gas distribution company from its parent company, China Resources Holdings Group. The distribution company, Mega Fair Ltd., is being sold for $324.4 million in U.S. dollars and the price in Hong Kong dollars is about 70 times as much. China Resources Gas is currently attempting to raise as much money as it can in order to fund this large purchase.
Mega Fair Ltd. currently distributes gas to nine major countries in China. The company intends on benefiting from the rising demand for less-polluting energy sources in the country. They are also trying to keep up with Beijing’s push to lower the country’s use of crude oil. China Resources Gas is trying to buy the company for less than it is being offered because, even though they are experiencing difficulty raising the money, they believe they can expand Mega Fair’s market and strengthen customer support which would only benefit all of the parties involved. China Resources Holdings Group would be selling about 230 million of its shares to China Resources Gas. The final decision on this matter will be left to the shareholders of China Resources Holdings Group.
-Ashley Luddy
This is a very interesting post because it has to do with the expansion of two major gas companies in China. It is interesting how they are trying to work together for a less-polluting energy sources around China. China is one of the worst polluted nations in the world and this transaction would be huge for the country because they can work together to better fuel China. with Mega Fair Ltd. currently distributing to nine major cities in China, that will help with the energy sources and hopefully get China where it needs to be as a more "green" nation.
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