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ENN Energy backs up US$2.2 bln bid for China Gas

Chinese gas distributor ENN Energy Holdings (2688.EKG) said it has ample cash to fund a US$2.2 billion bid for a stake in rival China Gas Holdings (0384.HKG), Reuters reported. Wilson Cheng, ENN Executive Director and CFO echoed an earlier statement by its bid partner Sinopec (0386.HKG), that ENN had around US$951.29 million in cash, enough to finance the takeover. Cheng added that China Gas’ board had refused to contact ENN and Sinopec directly on the proposal. The bid partners are in the midst of securing shareholder and regulatory approval before making a formal offer. An unsolicited cash bid for China Gas by the two companies was rejected in December. The race for the gas giant has intensified as several key shareholders, including South Korea’s SK Holdings, have increased stakes in China Gas by buying shares on the secondary market in recent months. A successful takeover could produce a powerful natural gas distribution group in China’s fast-growing market.

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