China gas refuses to negotiate till the buyer raises offer price

China Gas Holdings has announced that it will not negotiate with its potential buyer ENN Energy Holdings unless the offer price is raised by the company.

In December, ENN and state giant China Petroleum & Chemical Corporation, or Sinopec Corp, proposed to buy China Gas for a combined HKD 16.7 billion, or HKD 3.5 per share. According to China Gas Holdings, the offer price does not fully represent the value of the company.

ENN cannot make the deal unless it holds over 50 percent of China Gas.

Currently, ENN has nothing. Sinopec has about 5 percent. The two have been seeking to buy shares from existing shareholders.

China Gas major shareholder, South Korea's SK Energy & Services has boosted its stake several times in the firm recently. It now holds 10.7 per cent of China Gas. Also, a joint venture set up by a shareholder Fortune Oil and the firm's ex-managing director Liu Minghui raised their interest to 12.68 per cent.