South Korea’s leading city gas provider SK E&S Co. has increased its stake in China Gas Holdings Ltd. as part of ongoing efforts to expand its presence in China’s city gas sector, a source said Wednesday.
The company’s stake in the Chinese natural gas service operator has risen to 7.8 percent from 5.9 percent, said the source familiar with the shares that are listed on the Hong Kong Stock Exchange.
SK E&S announced last week it would eventually purchase an additional 5 percent stake in China Gas Holdings for 120 billion won (US$ 103 million). Its affiliate SK Gas is known to also hold 4.49 percent.
SK Group, the third-largest conglomerate in South Korea, now holds 12.29 percent in the Chinese firm through its two units.
If SK E&S continues to purchase as planned, SK Group’s total holdings will rise to around 15 percent, solidifying its position as the single largest shareholder of the Chinese energy company.
The market capitalization of China Gas has reached around HK$ 15.6 billion (US$ 2 billion), with 4.38 billion outstanding shares.
China Gas was reported last month to have rejected a US$ 2.2 billion cash bid from state energy giant China Petroleum & Chemical Corp. and Chinese gas distributor ENN Energy Holdings Ltd., saying the offer did not reflect the company’s actual value.