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Source: Reuters

China Gas offers to buy Zhongyu at a premium

Published: 26 Jan 2010 17:51:21 PST

HONG KONG, Jan 27 - Chinese natural gas distributor China Gas Holdings said it would make a general offer to buy all outstanding shares it did not already own in Zhongyu Gas Holding at a slight premium.

China Gas said it would offer HK$0.1743 in cash and 0.1512 new China Gas share for each Zhongyu share held. The share offer values each Zhongyu share at HK$0.9046, or 1.64 percent premium over the previous close.

China Gas, which will make an offer for all the convertible bonds and options of Zhongyu, said it intended to continue with the existing businesses of both the companies upon completion of the offers, and maintain the listing of Zhongyu.

Trading in shares of China Gas and Zhongyu will resume on Wednesday.

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Shares of China Gas, which constructs and operates city gas pipeline infrastructure, had risen 13.9 percent so far in January to close at HK$4.83 prior to a trading suspension, while stocks of Zhongyu Gas surged 15.6 percent to HK$0.89.

China Gas has a market capitalisation of HK$16.22 billion ($2.09 billion), while Zhongyu is at HK$1.73 billion.

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